The Secretary of State was asked—

Iain Wright: It is lovely to see the hon. Gentleman back from the break as well. In 1997, something like £1 billion a year was provided for child care; now the figure is £4 billion; and 470,000 families now get direct child care support through the tax credits system, at an average of about £68 a week. The long-term viability of nurseries and child care provision has been enhanced as a result of legislative strengthening by this Government, as well as increased and unprecedented resources. I would have thought that the hon. Gentleman and his constituents would thank the Government for that.

Iain Wright: My hon. Friend, who is obviously very knowledgeable about the issue through his chairmanship of the Select Committee on Children, Schools and Families, makes an important point. The inspection and regulatory regime that we have put in place with Ofsted will ensure that we can enhance quality and, at the same time, sustain funding and investment or increase them wherever possible. For example, local authorities have more than £1 billion at their disposal in capital and revenue funding to ensure the sustainability of the child care provision available in their areas.

Iain Wright: Like Blackpool, Hartlepool has benefited enormously from Sure Starts—indeed, I think that every single constituency in the country has. The Government remain committed to ensuring that more than 3,000 Sure Starts and children's centres are provided in this country. The scheme has provided for a revolution in child care provision, allowing the earliest and best possible start for our children, which will put them on a road of improvement and attainment throughout their lives. I would have hoped that the whole House supported such an important measure, but it is fair to say that the Opposition support the abolition of Sure Start and will not commit to funding for it.

Iain Wright: I completely disagree with what the hon. Lady said. The expansion of free places for two-year-olds is fully funded through savings by, as she says, phasing out tax relief on child care vouchers. That is at no extra cost to the taxpayer. I have to say, however, that the savings to the taxpayer are disproportionately given to the more well-off families—the figure is in the region of 6 per cent. We will continue to make sure that we invest in high-quality child care for low and middle-income families because all the evidence shows that that is vital for improving outcomes. If the hon. Lady wants to continue to narrow her focus on the highest earners, that is up to her, but the Government are on the side of low and middle-income Britain.

Tim Loughton: I could quote to the Minister several consultant paediatricians who think that their job of dealing with child protection will be compromised by the use of ContactPoint. Will the Minister therefore confirm how many people have applied to have their children's details shielded on ContactPoint and how many of them are Ministers—including himself, perhaps? If he is completely happy with the security arrangements surrounding ContactPoint, will he now undertake to publish in full the data security review on ContactPoint carried out by Deloittes, which he has declined to publish since February last year?

Parmjit Dhanda: Just before the summer recess, my right hon. Friend announced a review of secondary education in Gloucestershire to be conducted by Graham Badman. Should Graham Badman produce a report that encourages the building of an academy in my constituency, will my right hon. Friend give it full support and join me in encouraging the local authority to support a £13 million academy in my constituency as well?

Susan Kramer: Will the Secretary of State please give an assurance that where an academy is in process, but that process has not been completed—I am thinking of Sheen school in my constituency—funding will remain committed to it and will not be removed under any deficit-cutting programme?

Edward Balls: I toughened up the schools admissions code last year and changed the regulations. I am very clear that all schools—whether they be maintained, faith schools or academies—must comply fully with the code. When I did so, however, I was attacked by the Conservative Members for my actions, so I am afraid that I cannot give my hon. Friend the assurance he mentioned. I will deliver fair admissions, but they will not.

David Laws: The Secretary of State has already indicated that funding will be crucial to the development of the academies programme. In September, he gave an interview to  The Sunday Times in which he said that he was planning to cut £2.2 billion from the schools budget and that those plans had been in train within his Department for several months. Will he therefore, first, tell us when he gave the directive to his Department to look into the cuts; and, secondly, will he now publish the list of the proposed cuts that he went through with  The Sunday Times journalists?

Edward Balls: It is very interesting to hear that question because on the Saturday before my interview, the hon. Gentleman's party called for savage cuts and then when a discussion about efficiency took place, he backed off very fast indeed. The fact is that a year ago I asked an expert adviser to help me to find efficiency savings so that I could shift them to the front line. I am clear that I want the budget for education and schools rising year on year, and I would like to see that in real terms. The only way I can guarantee that teachers and teaching assistants are there at the front line, however, is to find savings in procurement and in how schools work together to free up those resources. I want the budget to rise next year, the year after and in future; it is the Conservative party that wants cuts—and cuts now. That is the difference.

Edward Balls: I went to visit Plymouth a year or so ago and the Minister for Schools and Learners has been there since. I am announcing today that both the Tamarside and John Kitto community colleges have been given the go-ahead to open in September 2010. In the case of Tamarside, it will be through the sponsorship of the university of Plymouth, and in the case of John Kitto it will be through the sponsorship of Exeter diocesan board of education. These will go ahead in 2010 because we are committed; we will deliver our national challenge and every school will be above the basic benchmark by 2011. That is my commitment—one that time and again I get attacked for making by the Conservative party.

David Laws: I have now had an opportunity carefully to consider the Secretary of State's answer. I still cannot understand how it can be that the last time we were here before the recess he told us he was going to resist all cuts to the education budget, but we then discover that a full year ago he had asked his officials to look into cuts. May I ask him about one of the specific proposals he discussed with  The Sunday Times—that to axe 3,000 head and deputy head teachers? Does he now accept that that was a mistake?

Edward Balls: No, of course I do not. The truth is that it was not I but the leader of the Liberal Democrats, at his party conference, who was confused about the issue of savage cuts. I made it very clear that I want the schools budget to keep rising year on year, and that I want the school education budget to rise year on year in real terms. We are achieving that in the current year, but we must be realistic: real-terms rises in future years will not be as high as they have been in the past, which means that the only way to deliver for the front line is to find savings. I think we can do that through school balances and procurement, and also by ensuring that schools work together and share their leadership teams. Every school should have a head teacher, but schools can share leadership teams in order both to raise standards and to become more efficient.
	The hon. Gentleman should be supporting me in this regard, but once again he is not doing so. I—and, I think, he—would like to see education spending rise in real terms; it is only the Conservative party that is advocating cuts and more cuts.

Michael Gove: The Secretary of State will be aware that among the very best performers in GCSEs this year were the schools run by ARK—Absolute Return for Kids—and by Lord Harris. They did up to four times as well as other comprehensives. The people running those schools say that their success depends on absolute freedom from local bureaucratic control. Does the Secretary of State agree?

Michael Gove: I am grateful to the Secretary of State for refusing to answer the question and exposing the threadbare nature of his own position. I am also grateful to him for reminding the House that the majority of local authorities are now under Conservative control. That is a welcome reminder of how poorly Labour authorities have done in improving education. I am also grateful to the Secretary of State for highlighting—

Mr. Speaker: Order. I am not interested in hearing about what the shadow Secretary of State is grateful for; I am interested in hearing a question—very soon, I hope.

Michael Gove: I am also grateful for your skilled chairing of our debates, Mr. Speaker.
	The Secretary of State's right hon. Friend the Member for Stalybridge and Hyde (James Purnell) has said—like us—that academies should become the norm in the state sector. Does the Secretary of State agree with that?

Diana Johnson: The hon. Lady will know that, as I have just explained to the House, the consultation will have taken place over a considerable period—from June until 19 October. A further response was made by my right hon. Friend the Secretary of State on Friday of last week, which set out further areas for consultation arising out of the Badman recommendations. There has been sufficient time for this consultation, and clearly the Government need to consider the responses—we will do so in the next few weeks.

Kate Hoey: The Minister must be aware of the real worry felt by people who home educate; there is a feeling that this is the beginning of the thin edge of the wedge—I use a cliché—and a move towards the German system of banning home education altogether. Will she give a categorical assurance that that is not the Government's intention?

Vernon Coaker: I do not accept the hon. Gentleman's point about the 500,000 children. Instead of decrying what is happening in primary schools, he would do well to celebrate—I am sure he does this in respect of his own constituency—the real achievements that have taken place. Since 1997, we have seen an increase in the figures for level 4 plus of 17 per cent. in English, 19 per cent. in reading and 17 per cent. in maths. Are we satisfied with that? No, we are not. Do we want more children to have the correct standard of reading, writing and arithmetic? Of course we do, so we have a series of measures and programmes in place to achieve that.

Vernon Coaker: My hon. Friend will know, because I have met her and Slough's director of children's services to discuss the particular issue in Slough, that we are seeing what we can do to resolve it. Primary school places are an issue in Slough and in some other authority areas across the country, which is why we recently announced a £200 million programme to see how we can address it. We are about to announce, in the not-too-distant future, the allocation of that money, in order to try to address some of the very real problems in Slough and in other local authority areas.

Nick Gibb: The Minister will know from the written answer that he gave me in July that fewer than half of 11-year-olds in the poorest decile in the index of multiple deprivation achieved the basic standard in reading, writing and maths, compared with three quarters who achieved that in the top 10 per cent. Frankly, whether it is a quarter or a half of 11-year-olds who are failing to grasp the basics, the Government's record of achievement is dreadful. Is he not ashamed of the enormous achievement gap between those at the bottom of the index of deprivation and those at the top in the very skills—reading, writing and maths—that every child needs, if they are to escape a life of poverty?

Vernon Coaker: I am not ashamed of what the Government have achieved with primary schools. I am proud of what the Government have tried to do and are doing to tackle this issue, which we all recognise. I do not accept the hon. Gentleman's points. Only recently, we received the results of the pilot of Every Child Counts from Edge Hill university, which showed that one-to-one tuition and small groups made a significant difference with some of the most difficult young people in terms of the educational challenge that they present, the special educational needs that they have and the difficult family backgrounds that many of them come from. We are expanding and developing these programmes—not only Every Child Counts, but Every Child a Reader—as the hon. Gentleman will know. That one-to-one tuition, which has been expanded through the whole primary school age group and will now be rolled out into year 7 in secondary schools over the next year, will make a significant difference. If we put that together with some of the other measures that we are taking to deal with the social issues around those schools, we will see a real improvement.

Vernon Coaker: One of the points that I was trying to make in answer to the hon. Member for Macclesfield (Sir Nicholas Winterton) is that there have been real improvements in primary schools across the country, including in some of the most socially disadvantaged communities. The difference between our stance and that of the Opposition is that they say that because there are still things to be done—because young children in our schools still do not reach the required standard—everything in primary education is wrong, that the teachers are not teaching properly and that progress is not being made. Our approach is to say exactly what my hon. Friend has just said: there has been progress, but there is still more to be done and the programmes that we have laid out, as well as the record levels of investment, will tackle some of them and will lead to a continuing rise in attainment in our schools.

Edward Balls: I absolutely refute that. If the hon. Gentleman had looked in his inbox—I accept that 29 July was quite recent—he would have seen the letter from me to all MPs that makes it absolutely clear that when an MP is visiting one of their local schools for prize-giving or whatever else, there is no requirement for them to register. Only if he were teaching a class regularly would he have to register—I do not think that the hon. Gentleman will be, so he will be fine.

Vernon Coaker: We estimate that 38 per cent. of current head teachers will have retired by 2015. Dealing with the loss of their skills and experience will be a challenge and an opportunity. We have invested £30 million through the National College for Leadership of Schools and Children's Services succession planning strategy to ensure that this demographic challenge is managed effectively. The national college continues to work closely with schools, local authorities and faith bodies around the country to find, develop and keep excellent head teachers.

Vernon Coaker: I do not accept that there is a crisis in head teacher recruitment. There is a challenge, and that is one reason why we have given the national college £30 million to help develop succession planning, which is necessary. On the issue of axing 3,000 head teacher posts, that is not a figure that the Department has used. It is right as we develop schools for the future that we look at how schools are organised and managed, and federations are one way forward. Certainly, we have never used the figure of 3,000 head teacher posts to be axed.

Edward Balls: May I report on two issues? Although this was not debated in Parliament during the passage of the Childcare Act 2006, I have today written to Christine Gilbert, and I am copying the letter to the House of Commons Library, to make it clear that reciprocal child care arrangements between parents where there is no payment involved should not be a matter for regulation, and I have agreed today with Ofsted that with immediate effect this will be beyond the scope of its child care inspections. We will make this crystal clear by changing the regulations in the coming period.
	I should also report to the House that in the early summer I pledged £655 million to ensure a sixth-form or apprenticeship place for every school leaver this September. That would be 55,000 more places. I have to report that the demand for these places has again outstripped our expectations. As a result, I am making a further £11 million available now to pay for a further 2,300 places for school leavers this September. That will be a total of 57,300 places, which will be guaranteed by the Government and would be cut by the Conservatives.

Nicholas Winterton: During the recess, I visited a middle and high school in the United States of America. Displayed outside the school and in every classroom and room in that school was a Union flag—that is, a flag of the United States of America. Should we not follow that example, and would not pride in our country be part of education?

Edward Balls: I have visited the United States a number of times. I know that there are some parts of the southern states where different flags are flown, but I understand the point that the hon. Gentleman makes about the stars and stripes, rather than the Union flag. It is important that we fly the British flag, which should be flown on town halls throughout the country—we fly it on our Department. It is a matter for individual schools to decide what flag they fly. We have never mandated that as a matter of law, and I do not think that that would be the right approach to take. It is for individual schools to decide.

Natascha Engel: Chesterfield college in North-East Derbyshire has seen an increase of 10 per cent. in enrolment figures as a direct result of the recession. What extra financial support is the Department giving FE colleges around the country—Chesterfield college is not the only one—to make sure that young people throughout the country get access to the skills and training that they need to see them through the recession?

Iain Wright: As my right hon. Friend the Secretary of State has said, we have provided an unprecedented sum of money—an extra £655 million—to meet that September guarantee. He has just announced an additional £11 million to help another 2,500 learners, because we are absolutely committed, as I know my hon. Friend is in North-East Derbyshire, to ensuring that no one is left behind with this recession. We need the skills to allow our country and our economy to prepare for the upturn and to be prosperous in the future.

Vernon Coaker: May I say to the hon. Gentleman, as I said in an earlier answer, that we know that there is a problem for some authorities in different parts of the country, including London? We have received representations from authorities, following our announcement that we would make available to local authorities throughout the country £200 million to deal with the problem, and we expect an announcement to be made shortly.

Edward Balls: I am proud of the fact that the local authorities with the greatest concentration of the most deprived pupils have seen the fastest rise in results. I am proud also of the fact that schools with more than 50 per cent. of pupils receiving free school meals have achieved twice the rate of improvement of schools with less than 5 per cent. of such pupils. That has all happened because of the progress made by this Government. I am concerned, however, that in the most deprived schools, the most deprived pupils still do not make the progress that we would like. The only way to do so is through the intensive investment and one-to-one tuition that we are putting in to back those pupils—funding that would be cut in the schools cuts proposed by the Opposition.

Hugh Bayley: York has done well on capital funding for schools, gaining about £12 million a year under the Labour Government, compared with less than £1 million a year under the Conservatives. However, we still do not yet have a date for joining the full Building Schools for the Future programme. Will the Labour Government continue Building Schools for the Future if they win the general election?

Edward Balls: The answer is very clear. We will keep investing in Building Schools for the Future; indeed, we are doing so this year, next year and the year after. The Conservative party has pledged a £4.5 billion cut. That, I am afraid, would mean that schools would not be rebuilt or refurbished in my hon. Friend's constituency or in constituencies represented by hon. Members on both sides of the House.

Peter Bone: In a parliamentary answer, the Secretary of State said that he had no idea about how many children suspected of having been trafficked had gone missing from local authority care. If any trafficked child goes missing, that is appalling. If the Government do not know how many are going missing, how can they put the problem right?

Martin Linton: Is my hon. Friend aware that Wandsworth has the lowest proportion of pupils granted their first choice of secondary school in London? Furthermore, there are no secondary schools in an area of 7 square miles in the centre of the borough; parents and children there are uniquely disadvantaged, as they do not qualify—at least on distance grounds—for any oversubscribed school. Will the Minister meet those parents and advise them on how best to start a new secondary school?

Andrew Miller: During the summer my right hon. Friend visited the excellent Neston high school in my constituency, and also released £25 million for the building of an academy in my constituency. In both cases, there are issues about the quality of buildings. Will he look carefully to ensure that moneys released require buildings to be built that are sustainable and environmentally friendly, because that is a good investment for the future?

Edward Balls: I congratulate my hon. Friend and all those who have ensured that these new schools are being rebuilt and opened. We had an excellent visit to that school and heard a brilliant orchestra there. We need to ensure that our brand new schools are environmentally friendly, that they are planned well in acoustic terms so that they can cope with the needs of deaf children, and that they have the sports, music and arts facilities that they need. But one can do that only by continuing the investment in our schools—investment that we will guarantee and that, as I have said, the Conservatives are determined to cut.

Liam Byrne: Thank you, Mr. Speaker, for the opportunity to come here this afternoon and answer questions about the sale of Government assets.
	Our overriding ambition is to lock in the recovery and then to lay the foundations for growth in the years to come. Because of the action that we have taken this year, we are confident that growth will return to our economy towards the end of this year and into 2010. Over the months to come, therefore, the Chancellor will set out more detail around our plan to halve the public sector deficit over four years once recovery is secured. This entails a return to growth with support for firms and families; fair tax rises for those most able to bear the burden; and slowing the growth of public spending. As the Chancellor set out in April, an ambitious programme of asset sales is part of our plan—a plan that sets out up to £16 billion of property and other asset sales, with proceeds raised being used to support our priorities, including new capital investment and paying down debt.
	Today the Prime Minister set out a few details of that programme, and in the months to come we will publish a portfolio of assets to be sold. It will cover assets for sales, and assets where we wish to explore different ways of managing things in the future. The portfolio will include the Tote, the Dartford crossing, the student loan book and the channel tunnel rail link. We know that councils will make a major contribution to the overall level of asset disposals through sales of housing and other assets, as will central Government property. As I said, these three elements are expected to deliver £16 billion in receipts over the period 2011 to 2014. However, we aim to secure receipts from central Government sales within the next two financial years where and when market conditions are right.
	We have already sold £30 billion of public assets since 2004. This success, building on the £22 billion sale of 3G licences in 2000, played a major role in the reduction of debt over the past decade. We have made tough choices to cut debt in the past; those decisions allowed us to support the economy now. We will not flinch now from tough choices to allow us to live within our means in the years to come.

Vincent Cable: Thank you, Mr. Speaker, for calling this urgent question. It is Parliament's first day back, and we have seen old habits—this national car boot sale was announced in the media yesterday evening, with a major speech by the Prime Minister and no statement to Parliament.
	I have no objection to the principle of asset sales, which are an important part of managing the public finances. However, there are big questions about timing and content. Can the Chief Secretary first confirm the Treasury's own figures that the net worth of Government has declined from 70 per cent. of GDP in the late 1980s, before the big privatisation, to nil today and will decline to a minus figure in 2013? That means that if the Government were to sell off the whole of what remains of the public sector, they would have to pay somebody to carry it away.
	On the substance of the Chief Secretary's answer, he said that there would be £16 billion of sales. Is it not true that £13 billion of that will be from local authorities and that, as he confirmed to me in a discussion on the radio at lunch time, there is no pressure on local authorities to make those disposals and they will be free to invest the money raised? In that case, how will the sales narrow the Government budget deficit, if at all?
	Can the Chief Secretary explain why the Government were in favour of privatising the Tote in 2008, then announced in the Budget this year that it would be kept in the public sector in the medium term, but now say that it is to be privatised again? The Tote has had more false starts than any race in history.
	On the timing of this announcement, the Government have a terrible record in selling public assets, with the history of gold sales and the sale of QinetiQ, which was condemned by the National Audit Office. There is now a proposal to sell land, in a market in which development land is at about 15 to 20 per cent. of its peak value. Is that not an absolute guarantee that the Government will not get value for money, and that this announcement has been driven entirely by political concerns?

Liam Byrne: I am grateful to the hon. Gentleman for the question and for his renewed interest. I know that that is completely unrelated to his own difficulties to do with tuition fees and mansion taxes at his party conference recently.
	Let me be absolutely clear about the substantive question that the hon. Gentleman poses, because it is important and there will be wide interest in all parts of the House about our strategy. As I said in my statement, in the Budget, the Chancellor set out the ambition to sell about £16 billion of assets over the period 2011 to 2014. About £11 billion of those assets will, of course, be local authority assets. That is based on a long-term picture of what local government tends to sell each year. Over the past 20 years, local authorities have raised something like £3.7 billion a year, and of course they are free to keep those receipts and reinvest them in priorities such as affordable housing and schools.
	In addition, we anticipate that something like £2 billion of central Government property can be sold and reinvested by Departments. We believe that additional business and financial assets can also be sold, such as those that the Prime Minister listed, and that something like £3 billion can be raised from them over the next couple of years. Of course, that money will be available to pay down debt.

Philip Hammond: How telling that at the end of the Prime Minister's summer of denial, instead of following the Conservative lead and taking the tough decisions required to get the deficit under control, this morning he has ducked the issue and chosen to peddle the illusion that asset sales can somehow avoid the pain of fiscal adjustment—taking people for fools again. Can the Chief Secretary confirm that he, at least, understands that asset sales, however necessary they may be to reduce debt, do not reduce the deficit, and that they can only ever be a supplement to, not a substitute for, proper fiscal discipline?
	Can the Chief Secretary confirm also that the package of central Government assets mentioned this morning amounts in value to little less than a week's worth of borrowing at the current levels, and that it is not the Government's intention to seize the proceeds of sales of local authority assets? Can he tell the House why anyone should believe a word the Government say on asset sales when they have announced every single one before? The Tate in 1999— [Interruption.] No doubt it is coming. The Tote announcement was made in 1999 and was in the Labour party's 2001 election manifesto. The announcement on the student loan book was made in 1997 and again in 2007, on URENCO in 2005 and on the channel tunnel rail link in 2007. Not a penny piece has been achieved from any of them. Will the Chief Secretary confirm that the value of all those assets is now significantly lower than when their sale was first announced? Indeed, did not the comprehensive spending review 2007 pencil in a £6 billion receipt for the student loan book alone—twice what the Government now expect to get from flogging off the entire package?
	Selling the family silver will not solve the crisis in the public finances. The country has had enough of denial, dither and delusion. The Government need to start taking the tough decisions, not ducking them, or call an election and let someone else get on with the job.

Liam Byrne: I enjoyed the remark about tough decisions. I have made a mental note of the Tate. The hon. Gentleman presumably refers to tough decisions such as proposals on state pension plans—I understand that the National Institute of Economic and Social Research, having looked at his plans, has discovered that he is £3 billion short and five years out in his sums. So I will not take lessons in tough decisions from him.
	The hon. Gentleman knows that bringing public spending within the bounds of what is possible in the years to come will take a mixture of things: growth coming back, investing in new industries and jobs, the right decisions on tax—decisions that he has opposed consistently; I think that the Conservative party has voted against something like £20 billion of necessary tax increases for the years to come. It requires tougher decisions on spending in the years to come, but where there are things that the Government should not hold on to, we should sell them off. Yes, we should allow local authorities to keep receipts to invest in local priorities, but business or financial assets, such as those that the Prime Minister talked about today, can be sold off and the proceeds used to pay debt.

Several hon. Members: rose —

Peter Bottomley: Columns 586 to 588 in  Hansard on 9 July 1987 contain the acceptance by the Labour spokesman that the Dartford bridge—effectively the first privately funded, operated, designed and built public works—would, as I said as Minister in the previous column, have tolls for 15 to 20 years. How can we have trust in Parliament if both sides accept something and then one side says, "We'll keep the tolls going so we can sell it off"?

Liam Byrne: The figures on local authority asset sales that have been put before the House this afternoon are projections based on the pattern of local authority asset sales for the past 20 years. Over the last 20 years, local authorities have sold something like £3.7 billion of assets a year. As the recovery sets in and as market values return, we have no reason to think that those values will be any different in future.

Liam Byrne: The Department for Transport has to look at a whole range of scenarios for the years to come, not least whether another crossing is put over the Thames. That is why I said that the ambition over the next couple of years—the next two financial years—is to raise something of the order of £3 billion from the disposal of central Government businesses. We think that the assets listed could make a big contribution, but there will not be a fire sale. We will seek to extract the most value for taxpayers from the sale of the assets. That is why the Chancellor will return to the House with a portfolio of assets that we think it is right to sell over the next couple of years—the assets to which the hon. Gentleman referred will, I think, be among them.

Liam Byrne: I would define a fire sale as selling things for substantially less than we think we could secure for taxpayers. However, this Government have a good record of selling assets in order to pay down debt, not least regarding the money that was raised from 3G licences in years gone by. Those decisions allowed us to go into this recession with debt at something like 36 per cent. of gross domestic product, which is much lower than other countries in the G7. Those decisions have helped us to ensure that help is available for businesses and families to get through this recession—help that the Conservatives opposed.

Hywel Williams: On 29 June, the Prime Minister said that the £16 billion would be redirected to public investment. Will the money go to investment or to pay off debts? Even the Prime Minister cannot spend the same money twice.

Liam Byrne: As I tried to say in my reply to the hon. Member for Twickenham (Dr. Cable), we think that local authorities will be able to secure some £11 billion of asset sales and central Government will achieve some £2 billion of asset sales. That money will be available for re-investment in infrastructure and other capital investment priorities. There are some businesses that can raise some £3 billion over the next two financial years, and those proceeds can be used to pay down debt.

David Miliband: Mr. Speaker, with your permission, I will make a statement on the circumstances surrounding the decision of the Scottish Justice Minister on 20 August to release on compassionate grounds the man convicted of the Lockerbie bombing, Abdelbaset al-Megrahi.
	As the Prime Minister has said, Lockerbie was a terrorist act of the gravest brutality. It was the largest peacetime loss of life on British territory. It was a major tragedy, with the killing of 43 Britons in the sky and in Lockerbie, 190 Americans and people of 19 other nations. It was an act, by people and a state, that breached all norms of humanity. That is why the reception for Megrahi on his return in August at Tripoli airport was so unacceptable.
	My statement today sets out the events leading up to the Scottish Justice Minister's decision to release Megrahi. I will set out the changes in Libya's relations with the international community since 1988 and address the three central issues raised in respect of the UK Government at the time of his release: first, the decision by the Government to sign a prisoner transfer agreement with Libya that did not exclude Megrahi; secondly, the relationship between the British Government and Scottish Executive in the decision-making process; and thirdly, the separate questions of the investigation into the murder of WPC Yvonne Fletcher and the compensation for victims of Libyan-supported IRA terrorism.
	The House will know that today is the 25th anniversary of the Brighton bombing, when the IRA attempted to murder a British Prime Minister and her Cabinet, and did kill five people, including one Member of this House, and injured many others. Throughout the 1980s and 1990s, the Libyan Government were linked to a number of terrorist organisations, including the Provisional IRA. Libya's support for international terrorism defined its relations with the western world.
	As right hon. and hon. Members will recall, WPC Yvonne Fletcher's murder in April 1984 led us to cut off diplomatic relations. The bombing of a nightclub in West Berlin in 1986 was followed by US air-strikes on Tripoli and Benghazi. When evidence emerged supporting allegations that Libyan intelligence officers had been involved in the bombing of Pan Am flight 103 over Lockerbie in December 1988, the United Nations Security Council demanded that Libya hand over the accused and imposed sanctions when it failed to comply.
	During the 1990s there was evidence from a range of sources that the Libyans were also actively pursuing a range of nuclear, chemical and biological weapons programmes, as well as the development of ballistic missiles. Libya was a pariah state whose activities posed a clear and unambiguous threat to international peace and stability, and to our security in this country. The story of the past decade has been very different. Libya has abandoned its support for international terrorism and stopped its pursuit of weapons of mass destruction, in a series of events that merit the term unforeseeable.
	In 1998, the US and UK Governments put forward a detailed joint proposal for the trial of the two accused of the Lockerbie atrocity. Our joint commitment to close and transparent working in all matters has continued throughout this case. We reported our proposal to the UN Security Council and the UN Secretary-General and, with the support of the Security Council, in 1999 persuaded the Libyans to surrender the two accused to a specially constituted court in the Netherlands where a Scottish panel of judges, without a jury, would try the accused under Scots law. Libya also agreed to pay $10 million compensation to each of the families of the victims, whatever their nationality, if the defendants were convicted. Megrahi was found guilty under Scottish law by the court in 2001 and his conviction was upheld on appeal in 2002.
	Against that background and, as I will explain later, in particular after the Libyan admission of responsibility for WPC Fletcher's murder, the UK restored diplomatic relations in July 1999. The long-term aim was clear: the normalisation of relations with Libya.
	On 19 December 2003, following months of secret discussions with the UK and US, the Libyans announced that they would eliminate their weapons of mass destruction and nuclear weapons programmes, and restrict the range of their missiles. They also agreed to immediate international inspections and to be bound by all the relevant international agreements, which they now are. Today, we share information and co-operate in our efforts to disrupt and dismantle terrorist groups in Europe and north Africa, in particular al-Qaeda in the Maghreb, which was responsible for the kidnap and murder of Edwin Dyer in May. We also try to find common ground in the UN and elsewhere on matters of common concern.
	There is also an entirely legitimate commercial dimension to our ties. With the largest proven oil reserves in Africa and extensive gas reserves, Libya is potentially a major energy source for the future. We work hard to support British business in Libya, as we do worldwide.
	We continue to have serious concerns about human rights in Libya, including about freedom of expression, arbitrary detention, political prisoners and the mistreatment of migrants. There are a number of important outstanding issues, in particular concerning the investigation into the murder of WPC Fletcher and the campaign for compensation by the victims of IRA terrorism.
	In May 2007, Prime Minister Tony Blair made his second visit to Libya. His summit with Colonel Gaddafi at Sirte covered the full range of our interests with Libya. Mr. Blair signed a defence accord and witnessed the public signature of a major BP exploration contract. Also agreed was a memorandum of understanding on negotiations for a judicial co-operation package, including a prisoner transfer agreement and agreements on mutual legal assistance, extradition, and civil and commercial law.
	The UK had a model agreement, based on Council of Europe arrangements, that was the starting point for negotiation on our prisoner transfer agreements with any country and that provided the starting point for negotiations with the Libyans. Four points are relevant. First, a PTA provides for prisoner transfer, not prisoner release. Secondly, it provides a framework for transfer, not a right to transfer. Thirdly, a PTA cannot be used when appeals, including by the prosecuting authority, are outstanding, as in this case. Fourthly, Ministers in the sentencing jurisdiction—in this case Scotland—have an absolute right to veto any transfer.
	This standard draft had no provision for any carve-out for any named prisoner. However, the Scottish Executive made strong representations for us to seek to alter the standard PTA so as specifically to exclude Mr. Megrahi. The UK negotiation team, led by the Ministry of Justice, sought in good faith to achieve this goal.
	The Libyans insisted that the only PTA that they would sign was a PTA without any exclusions. So the Government had a clear choice. We could agree to a standard PTA with no exclusions, retaining for Scottish Ministers an absolute veto over any request for prisoner transfer in the case of Megrahi—a veto which they used in August this year—or we could have ended the negotiations to prevent an application for prisoner transfer. This would have set back our wider national and commercial interests that flowed from normalised relations, as the Justice Secretary has made clear. Since the PTA involved no prejudice to the rights of the Scottish Executive, nor pressure on the Scottish Executive, the Government decided it was right to go ahead. The PTA finally took effect in April 2009.
	In September 2008, a new factor came into play. Megrahi was diagnosed with terminal cancer. The Libyans became increasingly concerned at the prospect of Mr. Megrahi dying in a Scottish prison. They communicated this to the Government and to the Scottish Executive. It was repeatedly made clear in reply, including in the Prime Minister's meeting with Colonel Gaddafi on 10 July this year, that the decision on Mr. Megrahi's fate was exclusively for Scottish Ministers and the Scottish judicial system.
	Notwithstanding that any decision on release was for Scottish Ministers and the Scottish judicial system, the UK Government had a responsibility to consider the consequences of any Scottish decision. We assessed that although the decision was not one for the UK Government, British interests, including those of UK nationals, British businesses and possibly security co-operation, would be damaged—perhaps badly—if Megrahi were to die in a Scottish prison rather than in Libya. Given the risk of Libyan adverse reaction, we made it clear to them that as a matter of law and practice it was not a decision for the UK Government and that as a matter of policy we were not seeking Megrahi's death in Scottish custody.
	In Scotland, compassionate release generally comes into play in the last three months of a prisoner's life. Scottish Justice Secretary MacAskill has set out the process by which he arrived at his decision in August this year to refuse the PTA transfer but to grant Megrahi compassionate release. He also set out the grounds on which he did so. As the Scottish Justice Secretary repeatedly stated in his announcement, this was a decision for him and him alone to take. The Government were clear that any attempt by us to pressure the Scottish Executive would have been wrong. At the press conference announcing his decision, the Scottish Justice Secretary confirmed that there was "no pressure from Westminster".
	It is also important to address the unfounded allegation that we ended our search for progress in dealing with the legacy of Libya's past support for terrorism. Admission of responsibility for WPC Fletcher's murder and the payment of compensation were necessary for the restoration of diplomatic relations in 1999. Four years later, we secured Libyan agreement to a joint investigation into the murder. It was clear, including to the family, that anyone prosecuted for the murder would have to be tried in Libya. Since 2007, the Libyans have refused to allow the Metropolitan police to return to complete their work. We share the determination of the Fletcher family to find answers, and continue to work on this case.
	In 1995, Libya provided critical information on its past links to the IRA. At that time, the then UK Government wrote to the United Nations declaring that they were
	"satisfied that they have largely met our expectations"
	in accounting for the extent of their support for the Provisional IRA. Libya has since then considered the issue a closed matter. Nevertheless, in respect of the campaign involving hon. and right hon. Members to secure compensation from Libya in respect of its past support for the Provisional IRA, we have created a dedicated unit in the Foreign Office to facilitate the families' renewed campaign. The unit is currently working with hon. and right hon. Members to secure a visit to Libya soon.
	Twenty-one years on, the ongoing pain of the Lockerbie atrocity remains a testament to Libya's past association with international terrorism. Her re-entry into the community of nations does not and cannot absolve her of this responsibility. It does, however, represent a major step forward. The Government make no apology for their part in securing this progress and we reject the charges repeatedly made but not justified. The PTA was not an agreement for Megrahi's release. The Scottish Justice Minister said he was not pressurised to release him. We did not forget the victims of IRA terrorism, or WPC Fletcher. On that basis, I commend this statement to the House.

William Hague: We are grateful to the Foreign Secretary for making a statement and we of course concur with his remarks about the horrors of the Lockerbie bombing and about the 25th anniversary of the Brighton bombing, the memory of which means a great deal to all of us in the House, but particularly to those of us in the Conservative party.
	In other respects, we will differ with the Foreign Secretary's statement, because it is our view that the release of Mr. Megrahi by Scottish Ministers was a mistake, that the episode was characterised by obfuscation and confusion on the part of Ministers at Westminster and that it damaged the standing of this country in the United States. The Secretary of State said that the decision was absolutely wrong, and the director of the FBI said that it made
	"a mockery of the rule of law."
	As the Foreign Secretary has pointed out, relations with Libya have improved over the last 10 years, which we all welcome. Since then, as he also pointed out, Libya has voluntarily dismantled its programmes on weapons of mass destruction, surrendered al-Megrahi for trial and co-operated on migration and counter-terrorism. We all want that co-operation to continue for the future. In the opinion of most people of this country and in our opinion, however, the case to release Mr. Megrahi against that background was outweighed by the requirements of justice and the fact that he had been sentenced to life imprisonment for the murder of 270 people—an opinion shared across the parties, including by the leader of the Labour party in Scotland, who said that this would not have happened if the Labour party had been in power there.
	One of the most bizarre aspects of the decision to release al-Megrahi was the fact that the Scottish Executive, having concluded that they could not transfer him under the prisoner transfer agreement because it would breach assurances given to the United States, then concluded that it was appropriate to release him altogether. Would it not have been more sensible to conclude that if it was inappropriate to return him to Libya as a prisoner, it was even more inappropriate to release him as a free man?
	In the time available, let me put a few short questions to the Foreign Secretary about the Government's own conduct. Will he clarify what advice the Foreign Office gave to Scottish Ministers? We know that the Foreign and Commonwealth Office's middle east and north Africa directorate wrote to the Scottish Justice Secretary saying:
	"We do not consider that the UK entered into a definite commitment, legal or otherwise, with the United States."
	However, both the United States Attorney-General and Secretary of State were adamant that assurances had been given to the US Government that any person convicted would serve his sentence in Scotland—and, by implication, would serve the sentence. Why was there this fundamental difference of opinion between Westminster, Holyrood and the United States?
	Secondly, the Foreign Secretary appears to have argued in his statement, in line with what the Justice Secretary said in his interview at the beginning of last month, that trade played a big part—a view that I see the Justice Secretary now assents to—in the decisions made about the prisoner transfer agreement. In that case, why did the noble Lord Mandelson say of that suggestion that
	"it is not only wrong; it's completely implausible and actually quite offensive"
	to say that the release of al-Megrahi was in any way linked to trade.  [Interruption.] If the Foreign Secretary thinks that Lord Mandelson was wrong—however risky it may be make that assertion—he can say so and we can get that clear! Even more importantly, will he say what the event was that changed the Government's policy on the prisoner transfer agreement and caused the Justice Secretary to change his mind? What was the event, threat or negotiation that led to that change? Is it the case, as Colonel Gaddafi's son has asserted, that Megrahi was
	"always... on the negotiating table in all commercial, oil and gas contracts and when British interests were discussed in Libya"?
	The Foreign Secretary said nothing in his statement about relations with the United States. Given the evident differences of opinion with the US on the nature of the assurances given about Mr. Megrahi, should not the United Kingdom have informed the US about the change of policy on the prisoner transfer agreement? My hon. Friend the Member for Aylesbury (Mr. Lidington) tabled a question on 7 September, asking whether that was done, but no reply has yet been given. Will the Foreign Secretary clear up the confusion now by saying whether the US was informed of the British Government's policy and, if so, what was said in response? Will he now accept that the Government's handling of this matter in the aftermath of the Scottish decision left a great deal to be desired?
	The Foreign Secretary effectively argued in his statement that the Government were happy to see Mr. Megrahi released—he can put that a different way if he does not agree to those words, but that is effectively what he argued. Does he agree with me that it was therefore deeply regrettable that the Prime Minister stayed silent on this issue for five days after the release, and that it took him another four days to say that he respected the decision? Would it not have been better for the Prime Minister to say immediately either that he disagreed with the decision, or that he agreed with it if he thought it was, on balance, the right thing to do?
	Twelve days after the release, it emerged that the Minister of State, Ministry of Defence, the hon. Member for Harlow (Bill Rammell) had told the Libyans at a meeting in Tripoli that the Prime Minister did not want al-Megrahi to die in prison. That statement received tortuous confirmation from the Foreign Secretary when he said what he subsequently said in this statement—that
	"we were not seeking his death in prison".
	Why, then, did the Secretary of State for Children, Schools and Families say that
	"none of us wanted to see the release of al-Megrahi"?
	How can that be reconciled with the statements of Foreign Office Ministers? Why was the Cabinet unable to express a coherent view on the subject? Did it not damage this country in the eyes of the world that it was unable to do so?
	The Foreign Secretary commented on the prospects of taking forward the case of WPC Yvonne Fletcher. Will he say whether he sees any realistic prospect of success, and what the next steps will be?
	While we welcome the fact that the Government have changed their policy on support for the families who were victims of Libyan-backed IRA terrorism, can the Foreign Secretary assure us that as well as assisting those families, and consistent with that, Ministers will now raise the issue with Libyan officials and Government members whenever the opportunity arises? It seems extraordinary for Her Majesty's Government to give assistance to the families but never mention the subject in their dealings with Libya.
	Will the Foreign Secretary concede that, when all the facts are taken together, it is clear that damage was done all round because of the Government's mishandling of the matter? Not only do the British public disapprove of this decision; our American allies were mystified and felt let down, from the President downwards. At present it is harder to pursue improved relations with Libya after all this, because of the cloud of suspicion that currently hangs over Britain's dealings with that country.
	Given the number of questions, the huge public interest in the matter and the need for clearer answers to those questions, should we not have the independent inquiry into the matter for which we have called throughout?

David Miliband: Let me deal with the points made by the shadow Foreign Secretary.
	I think that much of the right hon. Gentleman's quarrel—he was quite open about this—is actually with the Scottish Justice Secretary. He described the way in which his view of the case differs from that of the Scottish Justice Secretary. He was right to say that there was a difference between the prisoner transfer agreement and compassionate release. As I said in my statement, the prisoner transfer agreement is not an agreement for release, but an agreement for the transfer of a prisoner from a prison in one country to a prison in another country. As I also said in my statement, the prisoner transfer agreement was not available for use because of appeals that were under way, including one from Scottish Ministers in respect of the length of the sentence. However, the Scottish Justice Secretary dismissed that.
	The advice to the Scottish Executive was the subject of letters published last month. There was no legal bar to the decision made by the Scottish Justice Secretary. It is also important to point out that at every stage in the late 1990s it was clear—as it would have been clear to any Government talking to another Government—that the Government could not bind the hands of their successors, and could not foresee all the circumstances of the future. Certainly, I think that the transformation of our relations with Libya qualifies for the term "unforeseeable".
	The right hon. Gentleman cautioned me about the risky business of decoding the remarks of my right hon. Friend Lord Mandelson, but actually they did not need to be decoded in this case. What Lord Mandelson said—as the right hon. Gentleman pointed out—was that there was no deal for the release of Megrahi in respect of trade, and that is absolutely right. I am afraid that the right hon. Gentleman was condemned in quoting the words of Lord Mandelson. As for the son of the Libyan leader, he has made it quite clear that there was no deal in respect of Megrahi's release.
	The right hon. Gentleman asked about the next steps to be taken on the Fletcher case. Obviously I will not give a running commentary on all the aspects, but I look forward to meeting the Metropolitan Police Service and the Fletcher family again this month with a view to discussing how we might take that forward. I think it would be wrong to give false hope at this stage, because the Libyans have made it absolutely clear that they consider the matter closed.
	Of course we will continue to discuss the support for the families of the victims of IRA terrorism with the Libyan authorities, but we have reached the very clear view that there is more chance of its being addressed on a humanitarian basis by representatives of the families than in a Government-to-Government negotiation. It is important to be open and clear about that.
	I said in my statement that candour and transparency were the essence of our special relationship with the United States. That relationship, and that basis, have been fulfilled at every stage of this affair. The right hon. Gentleman will I hope have seen the article in the  Financial Times last month by the new United States ambassador to the United Kingdom, which made it absolutely clear that our relationship with the United States was as strong as ever, and I hope he will also have studied carefully the words of Secretary Clinton yesterday, who could not have been more fulsome or clear about the strength, and continued strength, of the relationship between the UK and the United States.

Edward Davey: May I thank the Foreign Secretary for his statement and note in passing that long recesses are not a good advertisement for Parliament, as too often we cannot ask questions when they are most pertinent?
	The Foreign Secretary has once again tried to suggest that at all times the British Government acted appropriately and that they got the best possible result for everyone involved. I have to tell him that that is not the view of many victims of the Lockerbie massacre, or the victims of Libyan-supplied IRA Semtex bombs, or the family of WPC Fletcher—not to mention President Obama. How were the United States Government able to secure compensation from Libya for the Lockerbie bomb victims, yet the British Government failed to secure compensation for IRA bomb victims? Why did it take this summer's row to force a change in policy on compensation for IRA victims?
	Today, the Foreign Secretary has once again protested that there was no link between al-Megrahi's release and any trade deals; yet his explanation of why his right hon. Friend the Secretary of State for Justice totally changed his position on the prisoner transfer agreement with Libya suggests, in his own words, commercial considerations were a key factor, so is it not the case that trade came before justice? Even if trade issues did not affect the final decision to release al—Megrahi, is the Foreign Secretary saying that in all UK Government negotiations with the Libyans there was never any discussion involving any type of linkage between al-Megrahi's possible future release and trade deals for UK companies?
	While we all welcome the changed Libyan policies in recent years in respect of terrorism, will the Foreign Secretary not accept that the Libyan regime still has an extremely poor record on human rights? According to Amnesty, peaceful opponents of the regime can face execution merely for speaking out, so will the Foreign Secretary make it clear today that Britain wishes to see Libya clean up its act on human rights, and will he therefore explain why Britain has been training Libyan police and Libyan special forces, and granting a growing number of export licences for everything from water cannon to armoured personnel carriers?
	Given all this, surely the Foreign Secretary must think again about our call for an inquiry, and the Conservative call, and announce an inquiry that covers all aspects of the UK-Libyan relationship in the run-up to the release of al-Megrahi. Nothing else will be able to reassure the public that trade in arms did not come before justice. Anything else should be unacceptable to this House.

David Miliband: I want to start by saying very clearly that the fundamental issue in this case was the right of Scottish Ministers to take this decision without pressure. It is the word of the Scottish Justice Minister—not a member of the governing party in the United Kingdom, but a member of the Scottish National party—that it was his decision, his decision alone and a decision taken without pressure from Westminster; he himself has said that. The most fundamental responsibility of the Government was to respect the constitution of this country, which has devolved powers in respect of this issue, and that was acted upon very diligently by the Government.
	In respect of US compensation and the victims of IRA terrorism, the hon. Gentleman will know that the United States were at a different stage in the restoration of diplomatic relations than us. We restored diplomatic relations after the resolution of the WPC Fletcher issue, and, as I explained in my statement, the United States were at a much later stage in their discussions. None the less, I think it important to support the campaign being waged by hon. and right hon. Members on this issue.
	I will check  Hansard, but the hon. Gentleman did say in his question—I wrote it down—"Even if trade negotiations did not affect the final decision." That was an important thing to say because I could also quote what he said on the radio when debating with my right hon. Friend the Secretary of State for Justice, which was far from such an admission. I hope that the hon. Gentleman has now recognised that the final decision was not affected, as it could not be because we were not putting pressure on.
	In respect of Libyan human rights issues, the hon. Gentleman will know that the Foreign Office publishes an annual human rights report. He is right to draw attention to this, and I mentioned it in my statement. I certainly agree with him that we want to make human rights abuse a thing of the past, wherever it exists. Finally, the Libyan police training is a programme to help Libya meet its human rights obligations; far from undermining the case, which he and I share, that Libya needs to clean up its act, this was a way of helping it to do so.
	On the inquiry, which is the hon. Gentleman's single transferable answer to every conceivable policy problem, his call seems to be ill-founded. On the sentencing authority, the Scottish Executive and the Scottish authorities are the right people to consider whether there are any issues in that respect, and I come to this House to explain the facts of the case. Given that a lot of the papers have already been published—last month—I think there is more than enough material for him to make his own judgments about the situation.

Several hon. Members: rose —

David Miliband: I have a great deal of respect for my hon. Friend, whom I know to be a strong supporter of our work in Afghanistan and of the extraordinary bravery of our troops there. I hope he will accept that there is not a scintilla of doubt about the Government's commitment in that respect, nor a scintilla of support or succour given to those who would be attacking our troops. He said that this was a decision that we made. It was not a decision that the Government made; it was a decision made by the appropriate authorities—in this case, a single member of the Scottish Executive: the Scottish Justice Minister. It is right to say very clearly that it was not for the British Government to take this decision. It was for the British Government to assess the consequences of the decision and to make it clear that we were not seeking the death of Mr. Megrahi in jail, although it was a decision for the Scottish Justice Minister to make. That is something we said repeatedly throughout this affair.

Malcolm Rifkind: Is the Foreign Secretary aware that, as Secretary of State for Scotland in 1988, I had to travel to Lockerbie on the night of the disaster? Never for a moment did I expect that the person convicted of murdering more than 200 people would be released and sent home having served only eight years of a 27-year minimum sentence. Is the Foreign Secretary aware that he has made a remarkable admission today? In his statement he said—correctly, of course—that it was the Scottish Executive's Minister who took the decision, but he went on to say that the UK Government had a responsibility to consider the consequences of that decision. He says, in his own statement, that the only consequences that they considered were the implications of al-Megrahi dying in a prison in Scotland, rather than at home. So, has the Foreign Secretary, by his own admission, not acknowledged that he paid more attention to the views of the Libyan Government, who were responsible for this terrorist outrage, than to the views of the United States, almost 200 of whose citizens were killed on that evening?

David Miliband: I remember where I was in 1988—I was a student in New York. I can well imagine the emotion and passion that exists— [Interruption.] My right hon. Friend the Justice Secretary says that he remembers the right hon. and learned Gentleman travelling to Lockerbie at that time. I am sure that the right hon. and learned Gentleman never expected the transformation in Libyan relations that has taken place, nor anticipated the terminal cancer that struck. I want to address, head on, the nonsense that he talked at the end. We considered every eventuality —[Interruption.] I am sorry, but the statement is absolutely clear that we had a responsibility to consider the consequences of the decision that was taken, and the decision—be it one way or the other—had to be accounted for. Three possible decisions could have been taken, and they were all considered as part of our contingency planning for what the Scots might do, of their own accord, in the decision that was theirs to take.

David Miliband: That is the first I have heard of it. Obviously, some of the papers were released by the Scottish Executive last month and the normal freedom of information rules will apply. Perhaps my hon. Friend is referring to the papers of previous Governments—I do not know if that is the case, but I am happy to have a word with him afterwards to get to the bottom of his concern.

David Heathcoat-Amory: Is not the real problem that we have now in this country two competing jurisdictions—the Scottish Executive and the UK Government—both pursuing aspects of foreign policy and with overlapping and sometimes conflicting responsibilities? What is the Foreign Secretary doing to sort out this muddle and confusion and to prevent it from happening again, so that we can bring some coherence to our relations with other Governments?

Tom Levitt: Given that this was a decision by a Scottish Minister on compassionate grounds, I wonder whether my right hon. Friend has seen any assessment of the evidence that the hon. Member for Moray (Angus Robertson) mentioned a moment ago—particularly that on the medical grounds—or whether, in a few months' time, we might discover that compassionate release is as effective a cure for cancer as it once apparently proved for Alzheimer's disease in another high-profile compassionate case?

David Miliband: Although the Megrahi appeal was dropped, the appeal by the sentencing authority—by the Crown—was not. That is why the prisoner transfer agreement would not have been applicable in that case. Of course, it is completely within the rights of those in the Scottish system to establish any sort of inquiry that they want into the decision that was taken.

David Miliband: I am grateful for what my hon. Friend has said—he has been a doughty campaigner on behalf of the victims. In fact, I think that he was in a meeting in the Foreign Office the week before this all blew up, and he will know that there is a real commitment to that proposal. I am happy to talk to him about the sort of tweaks that he thinks necessary, but I think that the case that he made for a visit to Tripoli is overwhelming, and I look forward to its being met.

The following Member made the Affirmation required by law:
	Chloe Smith, for Norwich, North.

'(1) In the National Health Service Act 2006 after section 52 insert—
	"52A Application of sections 52B to 52E
	(1) Sections 52B to 52E apply to—
	(a) an NHS foundation trust authorised under section 35 on an application under section 33;
	(b) an NHS foundation trust established under section 56 to which subsection (2) applies.
	(2) This subsection applies to an NHS foundation trust if—
	(a) at least one of the trusts on whose application the NHS foundation trust was established was an NHS foundation trust within subsection (1)(a), or was an NHS trust all or most of whose hospitals, establishments and facilities were in England, or
	(b) the NHS foundation trust is the result of a succession of mergers under section 56, any of which involved an NHS foundation trust within subsection (1)(a) or an NHS trust all or most of whose hospitals, establishments and facilities were in England.
	52B De-authorisation: regulator's notice
	(1) The regulator may give the Secretary of State a notice under this section if it is satisfied that—
	(a) an NHS foundation trust to which this section applies is contravening or failing to comply with, or has contravened or failed to comply with, any term of its authorisation or any requirement imposed on it under any enactment, and
	(b) the seriousness of the contravention or failure, or, if there has been more than one, of any of them taken together, is such that it would justify the Secretary of State making an order under section 52D.
	(2) The notice must be in writing.
	(3) With the notice the regulator must give the Secretary of State a report stating the reasons why it is satisfied as mentioned in subsection (1).
	(4) Before giving a notice under this section, the regulator must consult first the Secretary of State (unless the notice follows a request by the Secretary of State under section 52E) and then—
	(a) the trust,
	(b) any Strategic Health Authority in whose area the trust has hospitals, establishments or facilities, and
	(c) any other person to which the trust provides goods or services under this Act and which the regulator considers it appropriate to consult.
	52C Grounds for de-authorisation notice
	(1) In determining under section 52B(1)(b) whether the making of an order would be justified, and in determining whether to give a notice under that section, the regulator must consider these matters (among others)—
	(a) the health and safety of patients;
	(b) the quality of the provision by the trust of goods and services;
	(c) the financial position of the trust;
	(d) the way it is being run.
	(2) The regulator must publish guidance as to the matters (including those mentioned in subsection (1)) that it proposes to consider in making those determinations.
	(3) Before publishing any guidance under this section, including any revised guidance, the regulator must consult—
	(a) the Secretary of State,
	(b) each NHS foundation trust to which this section applies,
	(c) each NHS trust intending to make an application to become an NHS foundation trust, and
	(d) such other persons as the regulator considers appropriate.
	52D De-authorisation
	(1) If the regulator gives notice under section 52B in relation to a trust, the Secretary of State must make an order for it to cease to be an NHS foundation trust.
	(2) An order made under subsection (1) must specify the date when it is to take effect, which must be within the period of 5 working days beginning with the day on which it is made.
	(3) On an order under subsection (1) taking effect in relation to a body, it ceases to be an NHS foundation trust and a public benefit corporation and becomes a National Health Service trust.
	(4) The order must specify, in relation to the trust, the matters mentioned in paragraph 5(1)(a) to (c) of Schedule 4 and, where the trust has a significant teaching commitment, the matters mentioned in paragraph 5(1)(d).
	(5) The order may provide for any provision under subsection (4) specifying the number of executive directors and non-executive directors to take effect at the end of a period specified in the order.
	(6) Schedule 8A makes further provision about trusts in respect of which an order is made under subsection (1).
	(7) If it appears to the Secretary of State to be necessary in order to comply with provision made under subsection (4), or made by regulations under paragraph 4 of Schedule 4, the Secretary of State may by order—
	(a) terminate the office of any executive or non-executive director of the trust;
	(b) appoint a person to be an executive or non-executive director of the trust.
	(8) Within seven days after the day on which the Secretary of State makes an order under subsection (1) the regulator must publish its report under section 52B(3).
	(9) In this section "working day" means any day which is not Saturday, Sunday, Christmas Day, Good Friday or a day which is a bank holiday in England and Wales under the Banking and Financial Dealings Act 1971.
	52E Secretary of State's request
	(1) If it appears to the Secretary of State that there are grounds for the regulator to be satisfied as mentioned in section 52B(1), the Secretary of State may request the regulator in writing to consider exercising its power to give a notice under that section.
	(2) A request under this section must—
	(a) specify the NHS foundation trust to which it relates, and
	(b) state the grounds relied on by the Secretary of State.
	(3) The Secretary of State must lay before Parliament any request under this section.
	(4) If within the required period the regulator does not give a notice under section 52B in response to a request under this section, it must, within that period, publish its reasons for not doing so with a statement as to how it has complied with section 52C(1).
	(5) The required period is—
	(a) 14 days beginning with the day after the regulator receives the request, or
	(b) any longer period specified in the request.
	(6) The Secretary of State may by order extend or further extend the required period."
	(2) Schedule 2 (which inserts Schedule 8A to the National Health Service Act 2006, which makes provision about de-authorised NHS foundation trusts) has effect.'.— (Mr.  Mike  O'Brien.)
	 Brought up, and read the First time.

Mr. Speaker: With this it will be convenient to discuss the following:
	New clause 11— Notification of Care Quality Commission special reviews and investigations
	'(1) The Health and Social Care Act 2008 is amended as follows.
	(2) In section 39 (bodies required to be notified of certain matters) after subsection (2)(d) insert—
	"(e) an investigation under section 48 (special reviews and investigations)."'.
	Government amendments 21 to 37.  [ Interruption. ] I appeal to Members who are leaving the Chamber to do so quickly and quietly to allow for orderly transition to the next business.

Mike O'Brien: I rise to move Government new clause 13. This amendment would insert the new clause into the Bill to enable a designated mental health NHS foundation trust to earn up to 1.5 per cent. of its total income from income that it derives from private charges. The new clause also contains a definition of mental health foundation for that purpose.
	In the course of the Bill's passage through Parliament— [ Interruption. ] Sorry, Mr. Speaker, I am afraid that my speaking notes are not in the right order. I apologise for that. They have just been reorganised, and I think that those who reorganised them did so somewhat more efficiently than they should have. Let me move to new clause 12 and Government amendments 21 to 37.
	The Mid Staffordshire Foundation NHS Trust failed its patents and the national health service. Members will be well aware of the history of that case, the House has debated it at length and I am grateful to many hon. Members, from all parts of the House, who during the past year have drawn our attention to the issues at Mid Staffordshire. We have to learn the lessons from that case and ensure that such events cannot take place again. The report of Dr. David Colin-Thomé, the national clinical director for primary care, contained a number of recommendations that are being taken forward, including better co-ordination among both the regulators themselves, and among the regulators and the primary care trusts and strategic health authorities.

Nicholas Soames: I am very grateful. On that particular point, following the dreadful events in Staffordshire, did the Minister issue to the strategic health authorities throughout Britain a lessons-learned document or any other instructions?

Mike O'Brien: Dr. David Colin-Thomé undertook a report on the issue, so a full report on the lessons to be learned was issued throughout the national health service. It was not issued as a ministerial directive; it was more a clinical examination of the issues that had arisen. We have now started an inquiry into the details of what happened locally in the trust. The inquiry is hearing evidence and will, we hope, report towards the end of this year or the start of next. I hope that that deals with the hon. Gentleman's point.
	Improvements have been made: for example, Monitor has formalised and improved its contact with the Care Quality Commission, which needed to be done; and, working with the CQC and Monitor, we are tightening up the quality requirements for aspirant foundation trusts.
	The amendments act on just two of the many lessons that we have learned from Mid Staffordshire. First, foundation trust status should not be seen as a one-way ticket. That is an important message which we need to put out off the back of the Mid Staffordshire incident. Secondly, transparent democratic accountability is vital when a foundation trust fails. Members want to know what Ministers will do to sort out the problem, and on that issue there were clearly some difficulties.

Mike O'Brien: There will clearly be variation in the work that trusts—whether foundation or, indeed, non-foundation—are able to conduct in public and in private. Some of their work is about contracts, including which contracts they are going for and how they make judgments and arrangements in relation to them, so some matters are commercially confidential. However, we need to ensure that trusts—whether foundation or non-foundation—are accountable publicly, so as much as possible should be in the public arena.
	I agree with my hon. Friend as far as that is concerned, but let me say this: the foundation trust model is a key plank of reform, allowing greater freedom and autonomy to those who can demonstrate high performance. FT status is a hard-earned privilege and an incentive to drive up quality, innovation, productivity and local accountability. When an FT has failed to live up to that standard and public confidence has been damaged, it is in our interests to ensure that the privileges of FT status are withdrawn. When I say "in our interests", I am talking about the interests of the public as a whole in ensuring that the foundation trust brand justifies giving such freedom and responsibility.

Lindsay Hoyle: rose—

Mike O'Brien: I take my hon. Friend's point, but in a sense the Care Quality Commission will be considering the quality of the NHS as a whole; it will examine particular trusts and particular issues in relation to trusts where it needs to do so. Monitor's role is different: to oversee foundation trusts and to ensure that that brand of independence, identity and accountability demonstrates good standards.
	The amendments need to be viewed in the context of Monitor's existing powers of intervention under the National Health Service Act 2006 and the de-authorisation proposals already in the clauses relating to trust special administrators. The 2006 Act gives Monitor wide powers to intervene on an FT in the event of a significant breach—the word "significant" is important—of the terms of authorisation. Monitor has a range of powers, including removing any or all of the directors of the board or requiring the board of an FT to do, or not to do, specific things. The clauses relating to trust special administrators already enable Monitor to trigger de-authorisation of a foundation trust that is no longer sustainable—again, an important word—in its current form. That is as a preliminary to the de-authorised trust coming under the control of a trust special administrator as part of a clearly defined six-month process.
	The proposal under consideration today is a further, distinct piece of the jigsaw. It enables Monitor to trigger de-authorisation when—and this is very rare—a sustainable FT has breached any term of its authorisation or a statutory requirement and the breach is so serious that it justifies that step. A power to de-authorise makes clear that foundation trusts must maintain the high standards expected of them and gives a strong signal to the public that organisations must earn the right to continue as foundation trusts. A de-authorised foundation trust would become an NHS trust under the Secretary of State's powers of direction. As with the clauses relating to trust special administrators, transitional arrangements would be put in place to allow the continuation of commercial arrangements entered into using FT freedoms and to ensure continuity of services for local people; that was particularly important in relation to Monitor.
	Triggering de-authorisation is a complex decision. I make no apologies for the complexity of the process, which is about balancing the freedoms and independence of the FT network with the need for democratic accountability. The amendments establish a framework requiring that Monitor considers the health and safety of patients, the quality of services that are provided, the financial position of the trust and the way in which it is being run. To ensure full and proper consideration of this issue, the amendments propose that Monitor be required to publish guidance setting out in detail the factors that it will take into account. It is also important that before triggering a de-authorisation, Monitor consults key stakeholders to get their views. Accordingly, the amendments require Monitor to consult the Secretary of State, the trust, the appropriate strategic health authority and relevant commissioners of the trust's services. That mirrors the process relating to trusts' special administrators.
	In addition to highlighting the need for such a de-authorisation process, the Mid Staffordshire experience highlighted issues of democratic accountability. While Monitor is responsible for the regulation of foundation trusts, the Secretary of State is ultimately accountable to Parliament for the overall provision of NHS services. Monitor's operational independence is a vital component of the regulatory framework, and one that we should seek to maintain, but when considering the most serious risks to patients the Secretary of State should have the ability at least to express formally his view. To enable that, the amendments propose that the Secretary of State will be able to request formally that Monitor considers de-authorising a foundation trust. In such a situation, it will be vital that the Secretary of State and Monitor are able to act quickly and transparently.
	We therefore propose that if Monitor believes that a differing course of action is preferable, it will be required publicly to explain its decision, either within a default of 14 days or within such further time as the Secretary of State deems appropriate to the particulars of the case. If there is a case for a longer period, Monitor may ask for that and the Secretary of State will be able to consider it and take a view as to how long it should be.

Mike O'Brien: We have discussed the process with Monitor and made it clear that we want it to be relatively quick. The hon. Gentleman will know from his experience as a Staffordshire MP that there were concerns about how that matter was dealt with and the speed with which it was dealt. We therefore need to ensure that there is sufficient time to deal with the issues so that Monitor is able to receive a request from the Secretary of State, in that particular part of the process. The Secretary of State will determine whether he believes that the situation requires such a request. Monitor will then have 14 days—it will be able to apply for more time if it wishes—to take a view as to whether de-authorisation is the appropriate process. If it decides that it is not, and that it can deal with the matter by taking various steps, it will say so and have to set out its reasons.
	If Monitor takes the view that de-authorisation is necessary, there will be a further stage in the process. We must not get mixed up about which stage we are talking about. At that stage, Monitor will be able to consult governors, the relevant strategic health authority and the various other parties that are directly affected, including the commissioners for the trust involved.
	I make no apologies for the fact that the system is complicated, but in practice, given the urgency and rareness of the situation in question, we need to be able to deal with problems expeditiously. It is important to make the point that, thankfully, we do not expect situations such as that in mid-Staffordshire to arise with any regularity. On the contrary, we believe that the process will be very, very exceptional. However, the criteria need to be set out on which each party that has to make decisions, such as the Secretary of State and Monitor, can do so. The speed at which decisions can be made and the various consultations involved will be allowed for in the process, because various organisations have an interest in the matter.

Mike O'Brien: Clearly, it was much easier for the Minister to take action directly with regard to Maidstone, which was not a foundation trust—to deal with the problem as soon as we had looked at the detail of the evidence that was presented. The Department took action on Maidstone.

Mike O'Brien: The hon. Gentleman can stand up and give his response rather than sitting chuntering from the Front Bench. If he wants to ask a question, I will happily give him an answer, but if he just wants to dismiss it and chunter, that is up to him. I am not sure that it is the best way of dealing with arguments, but there you go; it is the way he does it.
	I shall now deal with new clause 11, which was tabled by the hon. Members for Eddisbury (Mr. O'Brien) and for Hemel Hempstead (Mike Penning). It seeks to ensure that, when the Care Quality Commission undertakes an investigation or special review into a particular aspect of care pursuant to section 48 of the Health and Social Care Act 2008, relevant bodies are informed. In the case of an investigation or review of NHS services, that would mean informing the relevant primary care trust, strategic health authority and Monitor.
	I understand the concerns behind the new clause and I am very sympathetic to its aim; in principle, there is no great difference between us. However, an amendment to that effect is not necessary because the intended purpose is already covered under formal agreements that the CQC has made with Monitor and the SHAs. There is a shared view about what should happen, but I am concerned about some of the drafting problems with new clause 11. I could go into those problems, although there is no great difference between us on what the hon. Member for Eddisbury wants to happen and the various levels of contact.
	The CQC can carry out an investigation when it has evidence that suggests a serious problem, which may be putting patients at risk. Under the 2008 Act, it also has new, more powerful enforcement powers, which it will be able use to tackle serious service failings, such as those in the Mid Staffordshire NHS Foundation Trust. The CQC always informs SHAs when an investigation is carried out. That is clearly set out in a memorandum of understanding that has been signed by the CQC and the SHAs. In almost all cases, the CQC would also question the relevant SHA and PCT as part of its investigation. It would therefore be well aware of what was going on.
	The CQC also informs Monitor of an investigation involving NHS foundation trusts. Section 70 of the 2008 Act places a duty on the two regulators to work together. A legal duty therefore already exists. A memorandum of understanding between the two regulators states that, in carrying out their regulatory functions, the CQC and Monitor will inform each other as soon as reasonably possible of any matters that may require action or a response from the other. That includes notification in advance where that is appropriate. Therefore, in the case of investigations, the formal agreements that the CQC has in place with the SHAs and Monitor would provide for the notification that the amendment seeks to achieve. We know from experience that the CQC will also publicly announce any new investigation, and will involve all key stakeholders. I hope that that reassures the hon. Member for Eddisbury that we do not have a big difference in principle. We have already achieved what he and I would like through the agreements that have been made and the legal duty to co-operate in the 2008 Act, which is in place. I therefore do not believe that we need new clause 11.
	Amendment 25 seeks to correct a minor drafting error in clause 18(8)(b), which lists orders that are not subject to any statutory procedure. The other orders made in connection with trust special administrators are not subject to any statutory procedure and an order made under subsection (5) of proposed new section 65L should also have been included in the list. That makes the drafting consistent with the Government's original intention, which was approved by the House of Lords Committee on Delegated Powers and Regulatory Reform.
	Foundation trust status and its regulatory framework have brought significant benefits for patients. We want to continue and enhance those benefits, and to encourage more movement towards foundation trusts. However, the Government new clause and amendments will fill an important gap in the current regulations, to enable some of the issues that arose in the wake of the Mid Staffordshire debacle to be dealt with by Monitor and, in due course if necessary, by the Secretary of State. They also ensure that we can help to protect patients on the very rare occasions when a foundation trust fails its local population.

Stephen O'Brien: In addition to addressing Government new clause 12 and speaking to their amendments, I shall address new clause 11, which was tabled by my hon. Friend the Member for Hemel Hempstead (Mike Penning) and I.
	Before I address the substantive points, I want to place on record how disappointed I am that the Government have seen fit to make this serious group of changes to the Bill at this very late stage. They are introducing three new areas to what is already a portmanteau Bill. There is little reason why the measures could not have been introduced in Committee. I am sure that the whole House, particularly Back Benchers, will be disappointed that the debates that they wished to have are being squeezed by the Government's last-minute legislating.
	Government new clause 12 introduces five new sections to the four clause part of the National Health Service Act 2006 that deals with failing NHS foundation trusts, as we have just heard. The new sections give Monitor the power to give the Secretary of State a notice recommending de-authorisation on the following grounds:
	"the health and safety of patients...the quality of the provision by the trust of goods and services...the financial position of the trust"
	and
	"the way it is being run".
	The measures give the Secretary of State the power to de-authorise within five working days of such a notice being received, and the power to recommend to Monitor that it give a notice recommending de-authorisation. If Monitor does not give such a notice, the Secretary of State will have the power to ask it to provide a written report as to why not. The other measures are consequential amendments.
	The reason for the changes, as was made clear in the Secretary of State's letter to the shadow Secretary of State, my hon. Friend the Member for South Cambridgeshire (Mr. Lansley), is the Government's somewhat less-than-adequate response to the tragic events at Mid Staffordshire. Indeed, that response was, in part, the result of the absence of a transparent failure regime, which was promised in 2003 but is still not forthcoming.
	As it happens, as shadow Minister for the Potteries as well as a shadow Health Minister—Stafford is a key interest of all people in Staffordshire, and above all to everyone in Stafford—I have been closely involved with events since the damning report into the hospital, as have my hon. Friend and the Leader of the Opposition. We must remember that at the heart of the issue is the avoidable deaths of up to 1,200 people. Each of those deaths leaves family and friends with a heavy burden of grief, which is only intensified by the serious questions that need answering. Furthermore, the deaths can only be indicative that many hundreds more patients did not receive the treatment that they deserved and that they rightly expect in our NHS. Before going any further, therefore, we must take a moment to remember all those who have suffered and those who continue to suffer because of the failings at the Mid Staffordshire trust.
	Although that need not be a party political matter, sadly, there is a choice. The Government are unwilling to have the bright glare of a full public inquiry shine on that appalling scandal, and I pay tribute to my hon. Friends the Members for Stone (Mr. Cash) and for South Staffordshire (Sir Patrick Cormack) and to our party's candidate for Stafford, Jeremy Lefroy, who have campaigned hard for a public inquiry. The Conservatives supported such an inquiry and continue to do so, but the Labour party, including the hon. Member for Stafford (Mr. Kidney), who is now a Minister, opposed it. Jeremy Lefroy has worked hard, along with Cure the NHS, a coalition of deeply concerned people, to call the Government and local bodies to account.
	Under existing legislation, the Secretary of State can by order transfer the property and liabilities of the trust back to himself, among other bodies, so there is already a process of de-authorisation. The Secretary of State's hubris lies in one sentence of his letter on the amendments, which states:
	"Whilst we have a rigorous system of authorisation, we have no corresponding process to de-authorise."
	Could this set of late amendments be a cloak to cover the embarrassment of the Secretary of State and Ministers? Is it, at best, window dressing or, at worst, an attempt to shut the stable door after the horse has bolted? To decide whether the new clause has any merit, we have to examine not only the effect, but the motives that lie behind it.
	The simple fact is that the problems at Mid Staffordshire were not the result of a failure by Monitor or, in fairness, by the Secretary of State in his informal oversight of the trust. They were almost entirely due to existing problems in the trust that were ignored during the so-called "rigorous system of authorisation" and the flawed policies of the Government that put targets and bureaucracy before professionals and patient care. The Minister may have quoted the findings of the Colin-Thomé and Alberti reports, but, as has been shown in this Chamber and elsewhere, those reports are both flawed. Neither is independent of a civil service that has seen the chief executive of the Shropshire and Staffordshire strategic health authority become the chief executive of the NHS.
	The subsequent chief executive of the West Midlands SHA, Cynthia Bower, has become the chief executive of the Care Quality Commission. She only raised mortality rates once in her routine briefings to the board, and only in relation to the Healthcare Commission's announcement of its intention to investigate Mid Staffordshire in March 2008. On that occasion, she stated that
	"there appeared to be nothing to indicate that anything out of the ordinary was taking place on mortality".
	Board minutes show that performance is consistently measured in terms of meeting Government targets on waiting times and finance, and that the chief executive officer's briefings invariably focused on the latest strategy from the Department of Health. Neither report interrogates the Government's target culture, explains why the National Patient Safety Agency failed to alert anyone at any level about the high mortality rates or addresses the impact of the cull of the independent—and thus trusted—community health councils in favour of the in-house NHS patient and public involvement forums. Nor do they scrutinise, beyond the warmest and most meaningless words, the ability of local involvement networks, or LINks, to combat such problems in future. We pressed that point, to no avail, in Committee.
	Neither do the reports explore the fear culture that silenced nurses at the trust, which was almost the most unfathomable aspect of the episode for anyone who understands nurses. Neither report looked at the impact on the trust of trying to comply with the European working time directive nor examined the role that practice-based commissioning, a flagship Government policy, played in divorcing GPs from the secondary care that their patients were receiving.
	Most worryingly, neither report explained why the trust got through the so-called rigorous authorisation process. The House will know that the Secretary of State alone can authorise a foundation trust. He takes advice from the applications committee, but he is not obliged to follow its advice. However, the Secretary of State's predecessor has not apologised for the decision in this case, or explained where the process went wrong.
	There are other, potentially suspect, motives. The response to the consultation states that
	"some concerns were raised about the use of a public confidence test when the Secretary of State is deciding whether to request interventions. Monitor does not believe the test is appropriate, feeling it risks dragging the Secretary of State into any situation with media interest. Others are concerned that this could risk intervention being based on media perception rather than evidence."
	This is not the first time that we have seen the Government make public relations the prime motive for policy. Within this Bill, the regulatory impact assessment on trust special administrators lists in its summary that the first key non-monetised benefit is "maintaining public confidence", and suggests that a public perception that nothing was being done could be damaging to the organisation. The first considered monetised cost is, tellingly, "public perception/media handling".
	Why is the new clause flawed?

William Cash: There has been a good deal of discussion about the Mid Staffordshire NHS Foundation Trust, although I do not intend to go down that route now. However, in the context of the points made about Monitor, does my hon. Friend accept that some of us believe—I have said this in a reply to a letter that I received from the Minister—that although there is a case in certain circumstances for the Secretary of State to put pressure on Monitor, there are also occasions on which he should completely override it and take the powers to himself to take the necessary action to disband a trust? That may not be what my hon. Friend wants me to say—I am not sure.

Stephen O'Brien: We have been clear about the position, which is that if there is a serious failure, there must be the ability to make an early intervention. Broadly, in our view Monitor ought to be the body that can put in new management quickly and take the necessary powers, but under the Government's approach, Monitor has ultimately been a financial regulator rather than the overall regulator. That is why we have urged the Government to increase Monitor's powers, which would give it the retained independence.
	Let me move on. The Government's proposal has compromised the independence of foundation trusts and given the Secretary of State more incentive to meddle in them and potentially to play politics with them and the NHS. As even the response to the consultation document admits, Monitor expressed concern that, as framed, the proposals in the document did not adequately reflect the principles of Monitor's independence or of transparency. In addition, foundation trusts disagreed or strongly disagreed with the proposal, arguing that the process of de-authorisation would be detrimental to patients, staff and visitors. Some FTs questioned what the removal of FT status would achieve, considering the existing mechanisms to turn around hospital performance.
	As an aside, in the rushing through of the legislation, it has not been possible to see the responses to the consultation, only the Government's collation of them, which does not aid transparency. We have to ask: what have they left out? We are entitled to know.
	We could ask why the Secretary of State is pushing what some have described as reactionary legislation. What is clear is that it does not appear to be about patient care. That is why the shadow Secretary of State said that there was a big question mark over wanting to bring everything back under the Department of Health, as though it might be any better than Monitor at doing something about such problems or anything else that might have been proposed, because the only direct parallel from which we can draw evidence of a similar situation is Maidstone and Tunbridge Wells NHS Trust. Despite what the Minister said, the Department did nothing when the trust came under its gaze. There is therefore a real absence of confidence that the Department stands any chance of being any better at dealing with the processes. The question therefore has to be how we strengthen Monitor and the other processes.
	The impetus behind the new clause is clear from its wording, which includes phrases such as
	"the regulator must consider these matters (among others)...the way it"—
	the trust—"is being run" and
	"the Secretary of State may request the regulator in writing to consider exercising its power to give a notice".
	The new clause reads very much as though it has been written not by a lawyer, but by somebody who has PR concerns in mind. We need to be very careful about that.

Stephen O'Brien: I am very concerned that the Minister is framing his question on the premise that we can allow things to get as far as failure. If there is failure, there is already, as I have described, a de-authorisation process in place because there are already powers to distribute the assets and liabilities. The whole point is to bring about early intervention to prevent the circumstances at Maidstone and Tunbridge Wells and at Mid Staffordshire from arising and to ensure that we can put new management in quickly and early in the process, instead of having to wait until there has been a failure. At that point, all that one will be doing is looking at the past, rather than taking the early action that is required to address the problems. That is why my party has made an alternative proposal.
	The problems that manifested themselves at Mid Staffordshire will be solved only by stripping distorting targets out of our NHS, bringing back a strong patient voice that can speak truth to power and strengthening commissioning at the local level. The Conservative party has pledged to do all that—indeed, we pledged two years ago to do so. By using the wrong sledgehammer to crack the wrong nut, the Secretary of State has shown that he does not have what it takes to do the right thing by our NHS, the professionals and patients in it, and the people of Stafford.
	We therefore offer new clause 11. I was grateful to the Minister for saying that he broadly welcomed it, that he understood what lay behind it and that it was a fair attempt to ensure that we had in place something on which we could agree. It would ensure that Monitor and local commissioners and authorities had early notification of any special investigations that the Care Quality Commission was undertaking, including into foundation trusts, so that speedy action could be taken where necessary, and that includes replacing the management.
	That is the first part of the answer. The Minister keeps trying to drive the idea that the Government have the only concept in town and that they have a full de-authorisation procedure, but they have not proved that they have a rigorous enough authorisation procedure—if they had, Mid Staffordshire would not have got through the process. Moreover, a de-authorisation process assumes that something has to have failed, but we propose that we should get in early enough to prevent things from going wrong in the first place.
	The answer must be to strengthen Monitor, which has been one of the most effective regulators, not to divert power from it. However, the real problems would be very much helped by having something along the lines of the autonomy and accountability Bill that we have placed on the table and asked the Government to take up. We have offered it to the Government countless times, and with the Queen's Speech coming up, they will perhaps take this last opportunity to do the right thing. On that basis, I commend new clause 11, but my colleagues and I are not persuaded that the Government have made their case on new clause 12.

Sandra Gidley: I will be fairly brief. To sum up, I have no problem with the general aim of the new clause, but I have some regrets about the lack of time to look at it properly to check whether it does what it says on the tin. However, I appreciate that the timing of the consultation meant that it was not possible to introduce anything any earlier.
	Some of the criteria appear to have been plucked out of the air and the Secretary of State appears to have some wide-ranging powers to hire and fire, but I am not clear whether those are different from the powers currently in place. There is also the question of whether 14 days is the optimum length of time for Monitor or any alternative regulator to provide sufficient good-quality information.
	The consultation originally proposed seven calendar days. As the hon. Member for Eddisbury (Mr. O'Brien) pointed out, we have seen only the edited highlights of the consultation, but the document itself said that the majority of respondents favoured a longer time. There is some flexibility, as the Minister acknowledged that the time scale could be extended, but according to the consultation document a number of people suggested having a short period for the initial response and a longer back-up period if more detail were required. The actual length of time is not specified, so the concern is that this must be got right—otherwise, there will be a tendency to keep kicking the issues into the long grass. I would like an assurance that that cannot happen.
	The main gap that is still to be plugged has been mentioned. Tempting as it is to kick around the Staffordshire football again, we have a great deal of business to get through, so let me make just one point here. Mid Staffordshire was given foundation trust status, so there is either something wrong with the process that awarded that status, given what we know was going on in the background, or something wrong with Monitor.

Sandra Gidley: I thank the hon. Gentleman for that intervention, which relates to my next point. The process of awarding foundation trust status or the old three-star ratings seems to be based on financial information. I never thought that I would regard my hon. Friend the Member for Oxford, West and Abingdon (Dr. Harris) as a soothsayer, but I did when I looked back at what was said when we debated the Bill that created foundation trusts. My hon. Friend asked the then Minister, the right hon. Member for Barrow and Furness (Mr. Hutton):
	"What does the Secretary of State do when a hospital with a three-star or two-star rating is subject to a scandal"?—[ Official Report, 7 May 2003; Vol. 404, c. 730.]
	Unfortunately, the Minister was very unhelpful in his summing up and he seemed to think that my hon. Friend was speaking complete rubbish. It is easy to dismiss remarks, buy my hon. Friend was obviously making very prescient comments.
	It has been clear throughout—the current Secretary of State for Health was, I think, on the Health Committee at the time—that the three-star trusts usually gain that status because of financial issues. If finance is put alongside quality ratings, there is often a mismatch. I agree entirely with all those who have said in today's short debate that quality is being sacrificed at the altar of financial probity. We cannot separate the two, because quality is something that should not be allowed to drop under any circumstances. My original question about whether the process or Monitor were at fault remains pertinent, as there has clearly been a lack of liaison and a lack of attention to aspects other than financial ones.
	The Liberal Democrats will not oppose new clause 12. Although there is some regret about the fact that it has appeared so late in the day, I think that ultimately it is a good thing. It will allow more transparency and make decision making more accountable, and that can only be good.

Patrick Cormack: The hon. Member for Cannock Chase (Dr. Wright) is having to chair a meeting of a Committee of the House, which is why he is not present now. He did intervene briefly earlier.
	I must make it plain that since 1997, fewer of my constituents have gone to Mid Staffordshire hospital than before. Before the new Stafford constituency was created in 1997, when I represented the whole of South Staffordshire, a very large number of my constituents received excellent treatment in the hospital as it was then. I echo what was said earlier by my right hon. Friend the Member for West Derbyshire (Mr. McLoughlin), our Chief Whip, who cited the excellent treatment received by his late mother before she died in that hospital.
	The hon. Member for Stafford (Mr. Kidney)—I am delighted to see him on the Front Bench—my hon. Friend the Member for Stone (Mr. Cash) and the hon. Member for Cannock Chase now have far more constituents treated at Mid Staffordshire than I do, but I have nevertheless heard a number of very distressing stories. What happened at Mid Staffordshire was deplorable and inexcusable. All that concerns me in the context of this brief debate—and I will be brief—is that it must not happen again, but if by any unfortunate chance it does, there must be a mechanism to deal with the situation expeditiously.
	Mid Staffordshire should never have become a foundation trust, and after it became one, it was judged according to the wrong criteria. We were taken by surprise when it was revealed just how dreadful some of the treatments had been, how shoddily managed the place had been, and what a disgrace to the national health service it was. That should not happen in a civilised country.
	I am grateful to the Minister of State and the Secretary of State—as well as their predecessors—for the readiness with which they have discussed these matters with Staffordshire Members. I am grateful, too, for the keen and real interest that they have taken in these matters. I do not doubt for a moment that in presenting the House with the new clause, they are trying to ensure that a terrible disaster like the one at Mid Staffordshire does not happen again.
	As I said briefly to the Minister in an intervention, what worries me is that the process that is being proposed is extremely cumbersome, and I doubt whether it can produce the sort of expeditious result that my hon. Friend the Member for Stone and I both want. I would much prefer—my hon. Friend made the same point in his intervention—a quick mechanism allowing the Secretary of State, with whom the buck always stops, to intervene very quickly. When something like the Mid Staffordshire disaster comes to light, there should be no opportunity for long discussions and debates about who does what and all the rest of it. There should be an instant opportunity for dismissal, and for taking over management before anyone else dies or is treated in the inhuman way in which, sadly, so many patients were treated at Mid Staffordshire.
	When some time ago the Minister discussed with us—and the Secretary of State—his wish to introduce a mechanism to take away trust status, all of us around the table responded very positively. However, I am not entirely persuaded that the mechanism that he is proposing now will be as effective and expeditious as I would like it to be. Like him, I sincerely hope that what happened at Mid Staffordshire will never happen anywhere else, but human beings are fallible, and it could happen. If it did, I would want a lightning reaction; I would want the culprits to be got rid of, because at the end of the day all that matters is the quality of care that our constituents, wherever they live, receive in the hospital to which they have had to be taken. The tragedy of Mid Staffordshire is that the people who placed their trust in the medical care of that institution were in many cases terribly let down—not in every case, but in many, many cases. That must not happen again. One reason why people did not have too many fears was the fact that this institution bore the flagship label of a foundation trust, and yet never was any flagship holed below the waterline more often.
	I just hope that the Minister can reassure me; and because this should never be a party political matter, I would like him to enter into conversations with the shadow Secretary of State and other colleagues on my party's Front Bench to see if we can come up, even at this very late stage, with a solution that is acceptable to all of us, and one that can persuade all of us that there is, indeed, a remedy if disaster strikes again.

William Cash: I very much agree with what my hon. Friend the Member for South Staffordshire (Sir Patrick Cormack) has just said, and I am very glad that he agreed with some of what I said in an earlier intervention. I also agree with my hon. Friend the Member for Eddisbury (Mr. O'Brien) that we want effective early intervention; I think we are all agreed on that.
	I am also very happy to pay tribute to the Minister and the Secretary of State for the manner in which they have looked at this issue in Mid Staffordshire with both some of my colleagues from Staffordshire and myself personally on a number of occasions. If I may say so without implying any disrespect, they have dealt with this matter far better than their predecessors; that is my frank opinion
	This is a huge issue, and it is about lessons to be learned as well as what actually happened. As I said in my intervention on the hon. Member for Romsey (Sandra Gidley), I am sorry that the Select Committee gave only one sitting to these major issues—although we do now have the Francis committee. As my hon. Friend the Member for South Staffordshire said, the real problem arose in the granting of trust status in the first place, and, as I pointed out in my intervention, that was largely because the chairman of Monitor was present at that meeting and gave clear criteria. I have seen the minutes, and I have handed them over to the Minister—not that he needs me to hand them over to him—because it was astonishing that the Monitor chairman laid down criteria for finance and governance, and that was followed up by a number of questions that showed that that was the primary concern. The consequence was the Healthcare Commission report, and now what the Care Quality Commission is saying as well.
	I want the current inquiry under Mr. Robert Francis to be as successful as possible, but both the Secretary of State and the Minister know that I have grave reservations about whether it can achieve its objectives. I still profoundly believe—I am glad that my hon. Friend the shadow Secretary of State is present because we both know this, as does my hon. Friend the Member for Eddisbury—that it is essential that we have a full public inquiry if the consequences of this latest inquiry under Mr. Robert Francis do not work out. This all started with a failure of Monitor, and we must have a full public inquiry if the results of this inquiry are not successful.
	I must tell hon. Members that only last week I received yet another letter from a constituent—I have passed it on—about a grandfather who died in the most appalling circumstances, and that demonstrates that things are not going as well as they should in this hospital. The Secretary of State may not recall the letter immediately, but it is with him. I am profoundly concerned about merely leaving these issues to Monitor. As my hon. Friend the Member for South Staffordshire said, this is very convoluted stuff; I have no doubt that many lawyers have sat down to plough through the relative powers and functions of Monitor and the Secretary of State, and are seeking a way to get the right result, by nudging rather than by pushing or, indeed, by having things taken over. This situation would have been a lot more straightforward if we had been given a straight answer to the straight question that I have put so often: why cannot the Secretary of State take for himself powers—like special measures in schools—to override everybody in the interests of the health of our constituents?

Andrew Lansley: I share my hon. Friend's view that restoring public confidence—on the face of it, that is the Government's intention—can now be done in Staffordshire only on the basis of an independent and public inquiry. We are committed to that. However, he must recall that the problems—the quality issues—at Stafford hospital started not with foundation status, but before that. They had started over a considerable period of time when the trust was an NHS trust under the scrutiny of the strategic health authority and the Department of Health, directly under the scrutiny of the Secretary of State. As the events at Maidstone and Tunbridge Wells told us, the Secretary of State's direct line of sight to hospitals does not mean that the Secretary of State knows what is going on and is doing anything about it; we have seen too many instances of that.

William Cash: I hear with great interest and respect what my hon. Friend says, but I must mention that in this particular case there is a connection involving Mr. David Nicholson, who was the chairman of Shropshire and Staffordshire strategic health authority at the time that is being described. Subsequent appointments followed and he moved seamlessly up through the ranks to become the chief executive of the national health service. I shall not go into some of the more recent commentary that I have seen in the newspapers, but I must repeat a point that I have made on the Floor of the House and in other contexts: the problems do go back, but the real issue is that there is insufficient power for an override. Although Monitor and a degree of regulation can be in place, swift and last resort action can best be undertaken by the Secretary of State.
	I am passionate about this subject and deeply concerned about the effect it has had on my constituency. I shall bring my remarks to a close simply by saying that a lot of the problems that arise—we will see how the Francis report goes—relate to gagging clauses. This week, I have been in communication with a number of people, and I must say that gagging clauses on those who want to blow the whistle should be banned. The trouble with the Act that enables whistleblowing to take place—the Public Interest Disclosure Act 1998—is that it is not working. Gagging clauses should be banned by law; they should be made unlawful. It would be extremely helpful if the Minister could refer to that matter, because many of the problems that have accumulated result from people not coming forward. However, in the last resort the Secretary of State has to carry the can.

Ian McCartney: On the last point that the hon. Gentleman made, I should mention that I was the Minister responsible for the passing of the disclosure Bill; the hon. Member for South Staffordshire (Sir Patrick Cormack) was also involved, having many years ago promoted it. We secured an amendment—a change has now been made. It instructs chairmen of tribunals, even where there is a gagging clause or someone withdraws the complaint, that the matter has to be submitted to the regulator. I suggest that the hon. Member for Stone (Mr. Cash) contacts the relevant Minister of State at the Department for Business, Innovation and Skills to ensure that that is being applied. The reason for the provision was to try to prevent people from using gagging clauses or other mechanisms to prevent this type of information from coming out via the tribunal system.

William Cash: I am extremely grateful for that intervention and I hear what the right hon. Gentleman says with great interest. I had heard of that, but great ingenuity is being used by certain trusts—not just Mid Staffordshire but other trusts of which I am aware—that are using their lawyers and their medical establishment effectively to bypass and shut out consultants—in some cases, as many as 20-odd. I am concerned about that. It is no good having good intentions in an Act if the provisions can be bypassed in the way that they are being bypassed at the moment. I would have thought that it was Monitor's job, and that of the Secretary of State, to deal with that. Will the Minister please take note and get rid of these gagging orders, ensuring that there is no way that the gagging clauses can be used to bypass whistleblowers?

Mike O'Brien: May I begin by responding to the three hon. Gentlemen who represent Staffordshire seats—in particular, I acknowledge the Under-Secretary of State for Energy and Climate Change, my hon. Friend the Member for Stafford (Mr. Kidney), who has been present during this debate? The contributions that we have had from Staffordshire Members have been excellent and have reflected the enormous local concern about Mid Staffordshire. I appreciate and am grateful for the kind comments of several Opposition Members about the way in which the Secretary of State and I have dealt with these matters.
	We need to ensure that the deplorable and inexcusable situation, as it was described by the hon. Member for South Staffordshire (Sir Patrick Cormack), does not arise again. We need to ensure that the Care Quality Commission, which is an organisation that has recently been set up, has the power to look at trusts. We also need to ensure that Monitor is much more aware than it has been in the past of the problems that might arise with regard to various foundation trusts and that we have a process that will enable Monitor to de-authorise.
	The hon. Member for South Staffordshire asked whether the process was fast enough. The time scale is 14 days. A number of parties are involved and we think that it is right that they should be able to express a view and that an investigation should be conducted. The process looks more cumbersome in legislation than it would be in practice. Our aim is that this should be a fairly brisk process and that everyone should know publicly what the time scale is. The Secretary of State should publicly make a request and there should publicly be a response within 14 days. There is potential to extend that time frame if necessary and if investigations need to be conducted for a longer period. I hope that I can reassure the hon. Gentleman that we recognise the need for expedition and would seek to ensure that we can deal with matters as quickly as is reasonably possible.
	The hon. Members for Stone (Mr. Cash) and for South Staffordshire both want the Secretary of State to be able to intervene much faster. There seems to be a difference in opinion from those on their Front Bench. I can detect no wish from their Front Benchers for the Secretary of State to take the powers to intervene. The Front-Bench view seems to be that this should be dealt with by Monitor. That seems to me to be a difficult position for them to take, because the amendments give Monitor the power to de-authorise.
	I was struck during the speech made by the hon. Member for Eddisbury (Mr. O'Brien) by the fact that he seemed to think that the insolvency regime—an entirely different regime that has nothing to do with problems such as those that we faced with Mid Staffordshire—somehow already provides powers. It does not. It does not provide powers to intervene. As Ministers, we were not able to intervene. Monitor was. It has extensive powers but the problem was that in this case there was an issue with the way that it was dealt with. Public confidence was not restored by bringing in a full-time chief executive quickly—

Mike O'Brien: I hear rumbles from a sedentary position as the hon. Gentleman asks why no one asked Monitor to do it. There were considerable discussions between us and Monitor, which led to the appointment of the new full-time chief executive. Those discussions went very well. Monitor listened to the points of view that were expressed through Government and Opposition Back Benchers who represent the area, and who said, "Look, we need more action." At that stage, Monitor thought that it was all right, but it accepted after discussion that it needed to act more effectively, and I am pleased that it could do so.
	May I deal with the points made by the hon. Member for Romsey (Sandra Gidley)? Lessons need to be learned, and she rightly suggested that in future Monitor needs to assess properly problems if there is a foundation trust application. She wondered, too, whether 14 days was the right period. If we have discussions with Monitor, we can extend that period if a longer investigation needs to be conducted, so I hope that I can reassure her on that matter. She rightly expressed concern about the timing of some of this, but the long vacation intervened and various other processes meant that we had to act on this, and we were able to undertake a full, proper consultation.
	May I respond to the points made by the hon. Member for Eddisbury (Mr. O'Brien)? First, George Alberti and Dr. David Colin-Thomé conducted investigations and there are reports on this. Robert Francis is producing a report, which we hope will enable us to look at the more local issues. We need a rigorous process, and with the various reports that have been produced, we have covered it. The hon. Member Eddisbury appears to have no real wish for the Minister to be able to intervene, even in the most dramatic circumstances, which is not a tenable position for those on the Opposition Front-Bench to take. It is very much at odds with that taken by the Staffordshire MPs, who want to see a circumstance, at least in extremis, in which Ministers can intervene and take action.
	I am concerned about the position that the Conservative Front-Bench team have managed to take, which is at odds with the way in which most people would want cases such as the situation in Mid Staffordshire to be dealt with. It undermines, too, in an extreme situation the whole principle of parliamentary accountability. Ministers must be able to come to the Dispatch Box and say that they would take the required action if they needed to do so. Monitor can make a decision in such cases to de-authorise where necessary. To refuse Monitor that power would mean that Members of Parliament would not have the level of accountability that they needed, but that seems to be the position that the Conservatives—at least, their Front-Bench team—have taken. I am glad to see the Staffordshire Members in the Chamber, because Members from all parties share the view that we need a much more effective legal system in place to deal with such situations in future.

'(1) Section 44 of the National Health Service Act 2006 (c. 41) (private health care) is amended as follows.
	(2) In subsection (2)—
	(a) after "not greater than" insert "— (a)";
	(b) at the end insert ", or
	(b) in the case of a mental health foundation trust designated under subsection (2A), that proportion or 1.5% if greater."
	(3) After subsection (2) insert—
	"(2A) An authorisation of an NHS foundation trust which was an NHS trust must designate it as a mental health foundation trust for the purposes of this section if it appears to the regulator that it provides goods or services only or mainly for the prevention, diagnosis or treatment of any disorder or disability of the mind or for the benefit in any other way of people suffering from a disorder or disability of the mind."'.— (Mr. Mike O'Brien.)
	 Brought up, and read the First time.

Mr. Deputy Speaker: With this it will be convenient to discuss new clause 10— Private health care—
	'(1) The National Health Service Act 2006 (c. 41) is amended as follows.
	(2) In section 44 (private health care), after subsection (4) insert—
	"(4A) The Secretary of State may by regulations make provision for exceptions to be permitted to the restriction mentioned in subsection (2) subject to the principle that any such exception must in all the circumstances be in the interests of the National Health Service.
	(4B) The regulations may specify such other principles and conditions as the Secretary of State may consider appropriate."'.

Mike O'Brien: I now get to move new clause 13—

Mike O'Brien: Somewhere or other, hon. Members may well have heard me do so, as the hon. Gentleman says from a sedentary position.
	The aim of the new clause is to enable a designated mental health NHS foundation trust to earn up to 1.5 per cent. of its total income from income that it derives from private charges. The clause also contains a definition of mental health foundation trust for this purpose.
	In the course of the Bill's passage through the House, we have had several debates on the private patient cap. That debate was, I understand, reflected in the other place, too. The Government recognise the various concerns that have been set out, both here and in the other place, about the issue. We understand some of the frustrations that have been expressed. However, securing a consensus on an alternative approach is not easy. People have differing views about the private patient cap. Some say that there should not be one, some say it should be at zero, and there are a variety of views in between. We take the view that the way the system operates now is not the way we want to see it operate. It is not fair. We concede that argument immediately.
	There is a strong case for reform, but let me be clear: the Government are committed to maintaining and strengthening the protection of NHS services for NHS patients first, while allowing NHS foundation trusts a degree of flexibility to operate effectively in the best interests of patients and communities, and in the context of evolving health policies. The Government are committed also to a full review of the patient cap—based upon those principles. We want to ensure that any private money that goes into the health service is directed in the best interests of the patients and the NHS as a whole.
	Evidently, reforming the rules so that they are fair, logical and work well is far from straightforward, and opinion about how the cap should be reformed is, as I have said, very divided. Any new approach should therefore be developed in partnership with the NHS and other key stakeholders to ensure that it is pragmatic, workable and achieves our fundamental purpose without any unintended consequences.
	The Government are already committed to a full review of the cap, following the conclusion of the judicial review of the current legislation. However, I can confirm today that we will bring forward that review process to start as soon as possible, within a month. It will begin with a call to the NHS and other key stakeholders for evidence to inform the review, and it will seek feedback by January. To review the policy effectively, we will approach our stakeholders throughout the NHS—the people who operate by the current rules and who would put any future new arrangement into practice. Our aim, therefore, is to undertake a very fast review, to give people the opportunity to put in their various submissions and to look to come to a conclusion early in the new year. We expect that the policy review will begin in the new year and report to Ministers in the spring. By having a meaningful and considered review, the Government will be able to undertake a consultation on options for the best and most appropriate solution that we can act upon at the earliest available opportunity.
	Some Members of this House and of the other place will be keen to see action sooner, and I understand that view. We are committed to reforming the rules, but equally, we cannot risk a repeat of the situation with the existing legislation, whereby we introduce new legislation without, first, a proper and full engagement with the NHS as a whole.
	After various discussions on a previous occasion, a compromise was reached. At the time it looked like a relatively fair compromise, and perhaps it was, at the time, but it subsequently developed a number of anomalies that spread, and now the compromise is not working in a way that anyone would regard as entirely satisfactory.
	Our debates here and in the other place have highlighted a specific and immediate concern, however, for mental health NHS foundation trusts—all of which for historical reasons have a 0 per cent. cap. They have no ability to access any private income at all, and they have no flexibility to earn private income and thereby support their NHS service users.
	We have received representations about how 0 per cent. caps constrain the ability of trusts to develop a broader range of innovative services and to support key facets of Government policy on health and well-being—for example, by providing specialist help for back-to-work schemes or employees at risk of mental ill health. Some mental health foundation trusts might want to work with private services that aid employees in private sector organisations, or help people who want to get back to work. Such a trust is currently able to provide assistance and medical advice, but not to accept any remuneration for doing so. That work could, however, be in the interests of its recipients and in the long-term interests of the NHS, because it could help with some of the mental health problems in society as a whole. If we allow some private income to be earned, we may be able to find ways for mental health trusts to do much more with the private sector. The current situation denies trusts the opportunity to enhance care to their NHS service users, and that concerns us.
	The measure is therefore an attempt not to move the private sector artificially into the NHS, but to ensure that the NHS is able to earn private income to provide services to parts of the private and voluntary sectors, to work with other Departments and to ensure that we work with those private sector organisations with which other Departments work. The situation was not anticipated when the Health and Social Care (Community Health and Standards) Act 2003 was put in place, but, pending the review of the cap for all NHS foundation trusts, the new clause will establish an interim solution. If we enable a cap of 1.5 per cent. for those trusts, high-performing providers of NHS mental health provision will have room to innovate and to support the development of further high-quality services for the NHS.
	I stress that today's proposal is an interim measure. Our review of the cap will seek to address the wide variation in cap levels that exists between NHS foundation trusts, and to establish a uniform test or set of principles that can apply equally to all NHS foundation trusts. Let me be clear: today's new clause applies only to mental health foundation trusts and those that become such trusts in the interim. As part of a wider review, we will look more broadly at the way in which the whole foundation trust area would operate, the range of private caps and how they ought to be reformed to bring about a much fairer situation.
	We agree that private patient activity should be used to improve the service for NHS patients; that private income should subsidise NHS care and, therefore, be used to improve and widen services; and that NHS foundation trusts must above all preserve and promote the values of the NHS. Our review will consider those points. In other words, private patient income should be deployed for the benefit of the NHS and NHS patients. Our aim is not that the measure be a way for NHS hospitals just to earn some private income; there will have to be a purpose, and that will have to be taken into consideration. Our review will in part consider how that has developed.
	New clause 10, which was tabled by the hon. Members for Eddisbury (Mr. O'Brien) and for Hemel Hempstead (Mike Penning), would introduce a clause that was added in the other place but removed in Committee. We removed the clause because we believed that it offered the wrong solution, even though it was seen as an interim measure. Allowing exceptions only introduces further uncertainty for the NHS and will simply lead to more claims of unfairness. As I recently said, if such exemptions were allowed there would be many debates. We must try to avoid setting up a system in which we create even more unfairness.
	Our view is that the Conservative proposals would lead to greater unfairness. An exemption-based proposal would not remove the cap's underlying rule for the vast majority of NHS foundation trusts—that their private income should be restricted to levels set in 2002-03. A level playing field would not be fundamentally achieved at all; it seems to me that we would just produce greater unfairness and concern.
	Any regulations created using the powers in new clause 10 are likely to provide only for a simple exemption from the cap. If the new clause were accepted, some trusts would, apparently, get an exemption from the cap. How far would they raise their private patient income? That, it would appear, would be entirely for them. I am not sure that Conservative Front Benchers are proposing such a measure, but perhaps they are—it is not clear from their new clause what they are proposing. I look forward to the contribution from the hon. Member for Eddisbury setting out what they are in fact proposing.
	If the cap were entirely removed from some trusts, they would have no obligation to deploy their money for the benefit of the NHS or NHS patients, and the deployment of NHS resources to bring in private sector money could not be monitored or overseen—the Opposition new clause would, apparently, not allow that to happen at all. However, the Government's proposals for a policy review would, I hope, pave the way for a long-lasting legislative change in the future. The Government's new clause offers a pragmatic solution to the immediate concerns highlighted by hon. Members and those in the other place regarding NHS mental health foundation trusts, in respect of which we accept that there is an issue that needs to be dealt with now.
	It is very unlikely that most mental health trusts could breach the cap, even if they tried, within the next year or 18 months; raising such income would require a very significant effort. New clause 13 gives those trusts the freedom they need. They can engage with the private sector when that is in patients' interests, and they can ensure that they deploy effectively the resources they earn from that. Combined with the Government's commitment to bringing about a review of the cap as soon as possible, the new clause provides a clear way forward on addressing the practical difficulties of the cap while maintaining its core principles.

Stephen O'Brien: New clause 13 is a welcome concession resulting from pressure put on the Government, not least by the official Opposition in both Houses. However, it does not go far enough. It amends the National Health Service Act 2006 to allow mental health trusts to get 1.5 per cent. of their income from private care. It leaves all other foundation trusts with the proportion from the base year. As the Minister said, new clause 10 is our reintroduction of the original amendment from the other place; it would allow the Secretary of State, by regulation, to allow foundation trusts an exception to the restriction on private income outlined in the 2006 Act.
	With the lead from the very top, in the form of my right hon. Friend the Member for Witney (Mr. Cameron), we on the Conservative Benches are committed to our NHS as a high-quality service, free at the point of need and open to all. The public have seen and can see our commitment. I am grateful for new clause 13 because it shows that the Government recognise that private income for NHS foundation trusts does not undermine the principles of our NHS. The Minister made that point himself.
	The history of the cap was best summed up by the former Labour Minister, Lord Warner, who said in another place that it was "anachronistic" and
	"sops to parts of the Labour party".
	It was introduced as a concession to get foundation trusts past the Government's reactionary Back Benchers; Lord Warner said explicitly that he repented his sins over that issue.
	Limiting foundation trusts arbitrarily to the proportion of private-to-public income that they received in the base year is inequitable. The base year was 2002-03, the year before the first foundation trusts were authorised. For some foundation trusts, the limitation means 30 per cent., and for others, 5 per cent.; until now, it has meant 0 per cent. for mental health trusts. Worst of all, the limitation prevents many specialist hospitals, such as Great Ormond Street, from becoming foundation trusts.
	As Labour Members know, private income for NHS foundation trusts is not about rewarding shareholders, partners or staff, but about generating income that can benefit the patients—the vast majority of them NHS patients—of the hospitals. Labour Members might not take my word for it, but this is what their own former Minister, Lord Warner, said about private income:
	"it is potentially a source of income for trusts that they can use for the benefit of NHS patients"—[ Official Report, House of Lords, 6 May 2009; Vol. 710, c. 656.]
	On Third Reading, he went on:
	"We are moving into a financial climate where the NHS...will need every penny that it can get to meet public expectations"—[ Official Report, House of Lords, 12 May 2009; Vol. 710, c. 936.]
	The limitation also impacts adversely on UK plc, hampering our provision of health care to non-UK residents, and on our research base, which is dependent on funding.

Frank Dobson: I am one of the reactionary elements in the Labour party who opposed the measure—and I am proud of it. Does the hon. Gentleman not agree that the only justification for private income in these circumstances is if it is net private income, and if treating such patients costs the national health service less than the income that it receives? Is it not true that for many years under a previous Tory Government, treating private patients was a net loss to the national health service?

Stephen O'Brien: I suspect that the right hon. Gentleman is drawing on questionable figures—and, possibly, prejudice. I do not have anything immediately to hand that would enable me to counter him. His first point is, effectively, correct: it would only make sense for the governing body of a foundation trust to make sure that the organisation made a net gain. That would be the incentive in any event.
	Private income can also be used to make new services viable. A foundation trust might want to open what would need to be a 20-bed maternity unit, but public demand might, for example, fill only 15 beds while private demand might fill five. With the cap in place, that foundation trust could not set up the unit. The trust might want to build a new hospital, offer laser dermatology or provide another technology such as new cancer care services, but with the cap in place, it could not. The trust might also want to buy out private providers—that should get a cheer from Labour Members. However, with the cap in place, it could not.
	The real question, which should be in the minds of Labour Members and of the whole House, is what proportion of a foundation hospital's income may be from private work before NHS patient care begins to suffer. That is the question posed by the self-declared reactionary, the right hon. Member for Holborn and St. Pancras (Frank Dobson). When the issue is put in those terms, it is clear that no one here can answer the question precisely; in many ways, the question is a false correlative. There is no absolute point at which NHS patient care suffers. The suitable balance of public and private work clearly varies from hospital to hospital, which is why taking the base year is arbitrary and unjustified. Furthermore, there is a raft of other ways in which foundation trusts are kept accountable so that they are not short-changing NHS patients for private work: through Monitor, terms of authorisation, the mandatory services schedule, contract variations with PCTs, boards of governors on significant decisions, asset-disposal locks and consultation.
	The problem with new clause 13 is that it retains the arbitrary nature at the heart of the problem, and limits the raising of the cap to mental health trusts only. Why has the Minister chosen 1.5 per cent. when some hospitals get as much as 30 per cent. and many as much as 5 per cent.? For mental health trusts, the figure was nil, so 1.5 per cent. is of course an improvement. However, if, as I would argue, one were to apply the principle across the board to include children's hospitals such as Great Ormond Street, it would be vital to recognise that 1.5 per cent. is no less arbitrary than the other number that has been picked, and the hospital should receive recognition for what it is achieving. Can the Minister clarify where in legislation a mental health foundation trust is defined, because that has been difficult to find for registration purposes?
	By failing to address the vagaries of the cap across the rest of the foundation trust sector, the Minister has committed to preserving the unfairness. As a result, the amendment is confused. Why is he not lifting the cap on Great Ormond Street? Is he saying that the care of people with mental illness is more important than the care of children? I hope not, and I do not believe so. By preserving the unfairness, the amendment fails to deal with the problem even-handedly and lets down some of the most needy patients in our NHS. We are therefore minded not to support it, but we cannot put at risk the small benefit to mental health trusts. Therefore, with all that on the record, we will abstain.
	It is interesting to note, as a matter of process more than anything else, that the Minister said that the pursuance of a judicial review of Monitor's permissive interpretation of the legislation—ignoring, for instance, income from joint ventures and arm's length companies—was a reason not to do anything about the issue in Committee. We are now dealing with the remaining stages of the Bill on its final day in this place, and that judicial review has not yet been concluded. Why is the Minister bringing this measure forward now, whereas previously the review was an excuse for not doing so? I hope that he will give us a justification for that.
	Before I sit down, it is my pleasure and privilege to welcome the new hon. Member for Norwich, North (Chloe Smith) to her first debate.

Sandra Gidley: Most of my comments have already been outlined by the hon. Member for Eddisbury (Mr. O'Brien), so I will be brief. As he said, in the other place the Opposition inserted a clause to enable the Secretary of State to make exceptions to the private patient income cap for foundation trusts. The Conservative amendment seeks to reintroduce that measure, and had it been put to a vote we would have supported it. It is a shame that the Government removed the clause in Committee, but the reasons for that have been outlined, and at least we got a commitment to a review, which I welcome. The Minister outlined the process, but it would be helpful if he could be a little clearer about the time scales involved, because this could be one of those things that is kicked into the long grass and forgotten about once the impetus of the Bill is no longer with us.
	I welcome new clause 13 in some ways, because it helps mental health trusts, which are completely hamstrung at the moment. Many of them, including my local trust, have innovative ideas about things they want to do and services they want to provide that are add-ons rather than taking anything away from existing NHS patients. However, what puzzles me is why the amendment applies only to mental health trusts: why not have a wholesale move to a minimum of 1.5 per cent., or whichever was the rate at transfer? A small number of foundation trusts have a cap of less than 1.5 per cent., and they will be feeling aggrieved that they are missing out—that they have seen others gain something that will enable them to provide new services while they are still stuck in the same shackles. Why did the Minister not take the opportunity to be a little bolder and introduce a level playing field of a 1.5 per cent. minimum for everybody whose cap was beneath that? Was it simpler to take this measure only for mental health trusts, or was there a reason why it could not be done for the other foundation trusts? I share the sentiments expressed by the hon. Member for Eddisbury, in that I would not want mental health trusts to lose out, but it is a shame that an opportunity has been missed.

Mike O'Brien: Let me first deal with a couple of the points raised by the hon. Member for Eddisbury (Mr. O'Brien). I thank him for his indication that Conservative Front Benchers will abstain on this measure. We accept that this is an interim solution. We acknowledge that there are problems and unfairnesses in the way that the cap currently works, with some trusts able to have large amounts of private income and others seriously restricted.
	However, it was clear that in the area of mental health there was a major problem that was interfering with the development of public policy, encouraging trusts to engage with other providers to ensure that mental health issues were better addressed. I do not dispute that areas within acute trusts and other parts of the NHS have problems, but given the strong level of concern on both sides of the argument, and the fact that there was clearly a level of unfairness in the current system, we needed a proper engagement with this. It would have been easy to come up with an across-the-board solution, but the end effect would probably have been the creation of as many anomalies as we had solved. We took the view that there was clearly an issue with mental health trusts and that we could justify 1.5 per cent. on the basis that it was unlikely, given the sheer scale of the engagement, that most mental health trusts would be able to develop, within a year or 18 months, the level of private sector income that would hit that cap.
	We are looking to have a review within a relatively short time; I have just announced that I have brought it forward. We want to resolve the policy clearly with as much of a consensus as is likely to be possible. I say that knowing that there are people with very strong, well-argued, coherent views, and those who have views of a similar kind on the other side of the argument. We need to ensure that there is an ability to work through the iterative process so that the debate comes to as much of an understanding and resolution as possible.
	We also need to add to the equation the question of the purpose of such private income. Is it for the benefit of the NHS and wider health care, or does it just bring in some extra money which some boards may well feel it would be nice to have? We must have a clear view about that. As part of the review, I am seeking to flag up the fact that private patient income must be used for a purpose. I do not want it to be a long review—it should be fairly brisk so that in the spring we can come out with a clear view of the outcome of this debate.

Mike O'Brien: That is a fair point, and I acknowledge that we will need to consider tariffs and how services are provided and should be developed in future.
	I was asked a couple of questions. The hon. Member for Romsey (Sandra Gidley) asked about the process that will take place. The timetable is that the call for evidence will begin within the next month, and the Department will seek feedback by the end of the year. A policy review will begin in the new year, which we expect to report to Ministers in the spring, and a formal Government consultation presenting the options for the most appropriate solution will then be brought forward. In due course, it will be for those dealing with the matter to bring forward legislation, and I look forward to doing so.
	The hon. Member for Eddisbury asked me about the lack of a definition of a mental health foundation trust. He said that he had looked for it, but it is actually in the new clause. He is right that there is not a proper definition elsewhere, so we have included it in the new clause. I hope that he will see that a trust is included if
	"it appears to the regulator that it provides goods or services only or mainly for the prevention, diagnosis or treatment of any disorder or disability of the mind or for the benefit in any other way of people suffering from a disorder or disability of the mind."
	That is the definition that he seeks.
	The hon. Gentleman asked about the judicial review. Our view was that it would be better to delay our review of the matter until after we had seen the view expressed by the courts. However, lawyers consider such things with a degree of care, and I have done so and taken the view that the courts would actually want to know how the Government propose to deal with these issues. I believe that it would therefore assist the courts if we set out how we propose to do so, so that the fact that we are conducting a review can be taken into account in any judgment that they reach in due course in relation to the judicial review. He asks whether we have changed our mind: yes, we have. Have we considered the matter again? Yes. Have we taken the view that we can go ahead with the change now? Yes, we have—I have taken advice from those who advise us and taken the view that we can move forward.  [Interruption.] It was a lawyer's examination of the issues, to reach a sensible conclusion based upon the evidence.
	I am grateful for the indication that Conservative Members do not intend to oppose the new clause, and I hope that we will have the support of the Liberal Democrat Front Benchers.
	 Question put and agreed to.
	 New clause 13 accordingly read a Second time, and added to the Bill.

'Section 180(2)(c) of the National Health Service Act 2006 (c. 41) (payments in respect of costs of optical appliances for persons aged 60 or over) is omitted.'— (Mr. Mike O'Brien.)
	 Brought up, and read the First time.

Mike O'Brien: The new clause is designed to correct a drafting mistake that was made in the Health Act 2006, which is now consolidated into the National Health Service Act 2006. I understand that the error was spotted by officials on 8 September this year, and the new clause makes no change in policy.
	Since the introduction of the optical voucher scheme in 1986, Government policy has been that eligibility for NHS optical vouchers should be targeted at children and those who are in receipt of a qualifying income-related benefit or need a complex optical appliance. Those eligible for help on low-income grounds include those aged 60 or over. The change introduced in the Health Act 2006 seems mistakenly to have extended eligibility for optical vouchers to all people aged 60 or over, regardless of income. That was not referred to in the explanatory notes to the Act, and it was not the subject of an impact assessment or consultation. It was a mistake made during the process of preparing the draft Bill.
	Before Opposition Members have fun with this—I would expect no less—I remind them of the minor fact that although it is true that Ministers at the time did not spot that the wording was wrong, neither did either Opposition party's Front Benchers, so let us not be holier-than-thou about this. We accept that there appears to have been a drafting error. The best that I can work out as to how that happened is that there seems to have been some lack of clarity in the Department of Health's instructions, which led to a mistake in drafting that was never picked up in this place or the other place. The new clause simply corrects that error and reinstates the legislation that reflects our long-standing intention and policy, including at the time of the Health Act 2006—to maintain entitlement unchanged.
	No one eligible for an optical voucher before the mistake was made is affected by the new clause. Our view continues to be that help with the cost of optical appliances through the NHS voucher scheme should be targeted at those most in need, and that that represents the best use of NHS funds. That view predates our Government and has continued, by and large, under this Government.

Michael Penning: The Minister is right—we might have a little fun, but only for a few moments because I do not want to delay matters. I thank him for the letter of 2 October to my colleague, informing the official Opposition that the Department had found the mistake—three years after it was included in the measure; the Minister forgot to mention how long it had taken. However, he is right that the provision was not intended to be in the 2006 measure—I have looked through the work that took place long before I joined the Front Bench to ascertain how the Bill went through. He should be commended on his intention to continue the previous Conservative Government's work on optical vouchers.
	I noted the Minister's comment that the shadow Secretary of State had taken part in proceedings on the Bill and that perhaps he should have picked up the mistake. Not quite as many lawyers work for Her Majesty's Opposition as for the Department of Health. While we are having a bit of banter, let me point out that the hon. Member for Lincoln (Gillian Merron), now a Minister in the Department, was the Whip on the Bill. One therefore wonders whether the Bill that we are considering today, about which she may comment—she served on the Committee—has had the same sort of scrutiny that took place in 2006.
	After that bit of banter, we accept that a mistake was made three years ago and that the Government are changing the legislation at the first opportunity.

'After section 7(2) of the Children and Young Persons Act 1993 (c. 12) (sale of tobacco, etc. to persons under (eighteen)) insert—
	"(2A) A person commits an offence if he buys or attempts to buy tobacco on behalf of an individual aged under 18.
	(2B) Where a person is charged with an offence under subsection (2A) it is a defence that he had no reason to suspect that the individual was aged under 18.
	(2C) A person guilty of an offence under this section is liable on summary conviction to a fine not exceeding level 5 on the standard scale.".'.— (Mike Penning.)
	 Brought up, and read the First time.

Mr. Deputy Speaker: With this it will be convenient to discuss the following: new clause 4— Purchase of tobacco on behalf of children—
	'After section 7(2) of the Children and Young Persons Act 1933 (c. 12) (sale of tobacco, etc, to persons under (eighteen)) insert—
	"2A Purchase of tobacco on behalf of children
	(1) A person commits an offence if—
	(a) he buys or attempts to buy tobacco on behalf of an individual aged under 18, or
	(b) where he is a member of a club, on behalf of an individual aged under 18 he—
	(i) makes arrangements whereby tobacco is supplied to him or to his order by or on behalf of the club, or
	(ii) attempts to make such arrangements.
	(2) A person ("the relevant person") commits an offence if—
	(a) he buys or attempts to buy tobacco for consumption on relevant premises by an individual aged under 18, or
	(b) where he is a member of a club—
	(i) by some act or default of his, tobacco is supplied to him, or to his order, by or on behalf of the club for consumption on relevant premises by an individual aged under 18, or
	(ii) he attempts to have tobacco so supplied for such consumption.
	(3) Where a person is charged with an offence under paragraph (1) or (2) it is a defence that he had no reason to suspect that the individual was aged under 18.
	(4) A person guilty of an offence under this subsection is liable on summary conviction—
	(a) in the case of an offence under paragraph (1), to a fine not exceeding level 3 on the standard scale, and
	(b) in the case of an offence under paragraph (2), to a fine not exceeding level 5 on the standard scale."'.
	New clause 6— Disclosure of tobacco industry promotional and research activity—
	'(1) The Secretary of State shall make regulations to require a business which in the course of its activity sells a tobacco product or causes one to be sold to disclose details of its marketing and research activities.
	(2) Disclosure shall consist of but is not limited to—
	(a) the total amount spent on distribution, advertising and selling costs deducted from corporation tax;
	(b) distribution costs;
	(c) promotional allowances at retail;
	(d) competition prizes at retail;
	(e) tobacco display gantries at retail;
	(f) speciality item distribution;
	(g) brand development;
	(h) packaging design;
	(i) online marketing activity;
	(j) advertising in specialist trade press;
	(k) corporate social responsibility activities;
	(l) market research;
	(m) product research; and
	(n) any other marketing and research activity which represents more than 5 per cent. of the total spending by the business.
	(3) The Secretary of State shall make regulations to require disclosure of information and results from all market research and scientific research conducted by the businesses specified in subsection (1) in relation to tobacco products by type of product.
	(4) The Secretary of State shall require all information required by subsections (1) and (3) to be submitted on a quarterly basis by businesses specified in subsection (1) and shall, within three months, publish a report aggregating the data.
	(5) A person who does not comply with regulations under this section shall be guilty of an offence.
	(6) The provisions of section 13 (Enforcement), 14 (Powers of entry, etc), 15 (Obstruction, etc of officers) and 16 (Penalties) of the Tobacco Advertising and Promotion Act 2002 shall apply to this section.'.
	New clause 7— Restrictions on tobacco packaging—
	'Within six months of the passing of this Act, the Secretary of State shall set out guidance for consultation with appropriate stakeholders on regulations prohibiting or restricting the use of logos, colours, brand images or promotional information on tobacco packaging other than brand names and product names displayed in a standard colour and font style.'.
	Amendment 1, page 23, line 31, leave out clause 21.
	Amendment 16, clause 21, page 24, line 15, at end insert—
	'(2) No offence is committed under section 7A if—
	(a) the products are displayed at a place where tobacco products are offered for sale,
	(b) the display is of one packet only of each tobacco product which is offered for sale,
	(c) the display is no greater than 1.5 square metres in size, and
	(d) the display complies with such requirements as may be specified in regulations.'.
	Amendment 2, clause 22, page 26, line 3, leave out 'may' and insert 'shall'.
	Amendment 4, page 26, line 4, after 'prohibiting', insert 'in certain circumstances'.
	Amendment 5, page 26, line 4, leave out 'or imposing requirements in relation to'.
	Amendment 6, page 26, leave out lines 6 to 10.
	Amendment 17, page 26, leave out lines 7 to 10 and insert—
	'requirements as to the location of any automatic machine for the sale of tobacco which would prevent access to, or purchase of, tobacco by any person aged under 18.'.
	Amendment 7, page 26, line 12, leave out 'or requirement'.
	Amendment 8, page 26, line 13, leave out 'or requirement'.
	Amendment 9, clause 23, page 27, line 12, leave out 'may' and insert 'shall'.
	Amendment 10, page 27, line 12, after 'prohibiting', insert ' in certain circumstances'.
	Amendment 11, page 27, line 12, leave out 'or imposing requirements in relation to'.
	Amendment 12, page 27, leave out lines 15 to 19.
	Amendment 18, page 27, leave out lines 16 to 19 and insert—
	'requirements as to the location of any automatic machine for the sale of tobacco which would prevent access to, or purchase of, tobacco by any person aged under 18.'.
	Amendment 13, page 27, line 21, leave out 'or requirement'.
	Amendment 14, page 27, line 22, leave out 'or requirement'.

Michael Penning: It is a pleasure to take this element of the Bill through its final stages.
	I was a proud member of the Select Committee on Health that pushed the Government from a partial ban on smoking in public places to a full ban. I did not think that anyone should be protected under the legislation on a cherry-picking principle. It should be one rule for all or not at all. I was therefore pleased that the Select Committee, after taking a lot of evidence, reached conclusions that meant that an amendment was tabled and, on a free vote, the House came to a sensible decision.
	Unless things have changed since the debate began, I am sad that the two main Opposition parties have a free vote this evening, while the Government party does not. That is a shame. It is an issue of conscience— [Interruption.] No, the Government party does not have a free vote—Labour Members can ask the Minister. Some selective voting by Labour Members may happen, but the Government will oppose the amendments and that is a shame.

Michael Penning: That is a sensible point. We did not force any votes in Committee because we wanted the House to have the opportunity to express a view and did not want to constrain the House. I said to the Minister in Committee that the evidence appeared to be selective. I understand where it came from; I have nothing but admiration for Cancer Research UK and Action on Smoking and Health—ASH. I have worked with them in the past and will continue to do that. However, it is a Minister's job to examine all the evidence so that legislation is evidence-based.

Michael Penning: The important point is that the businesses to which my hon. Friend refers are operating legally. We are considering a legal product. I am sure that many hon. Members would like it to be illegal, but it is not. While it is sold by businesses legitimately, fairly and legally, they should not be persecuted. That is my view and my reason for tabling the amendments.
	There are four new clauses and a raft of amendments and I shall try to speak about as many as possible, but without taking up too much of the House's time because it is important that hon. Members vote on as many as possible. The Opposition are looking to press new clause 1 and amendments 1 and 2 in particular to a vote.
	I find it strange that the Government have not accepted the substance of new clause 1 and tabled such an amendment themselves. Raising the smoking age from 16 to 18 had broad support throughout the country, levelled up our legislation with that of many of our European colleagues and friends, and made it similar to that for alcohol. Yet while it is understandably illegal for someone to proxy-purchase alcohol and pass it on to a minor, it is not illegal to proxy-purchase cigarettes and pass them on to a minor. I do not understand that. If the measure is to protect young people, and I genuinely broadly support it, I do not understand why new clause 1 is not accepted, especially given the evidence from the manufacturers themselves that 89 per cent. of young people who smoke buy cigarettes from or are given them by another person outside a legal shop premises.
	I have no truck with tobacco manufacturers. They know—I have said it publicly—that I would be happy if they went bust tomorrow morning. I do not like tobacco products, but while they are legal, legal businesses, which do not break the law, should have every opportunity to sell them and not be penalised.

Michael Penning: I do apologise—it is being enforced in Cambridge, where partnerships have worked together and driven down the amount of alcohol being drunk on the streets, particularly by young people. It can be done, if there is a will. I know the hon. Member for North-West Leicestershire (David Taylor) very well. We do not want young kids to buy tobacco from, or to be given tobacco by, an adult who is making an illicit earning by doing so.
	The shops, of course, are doing their best. They are asking whether people are 18 years old, and when someone proves that they are, they can buy the tobacco and sell it on. That cannot be acceptable, and we do not accept it with alcohol. If the hon. Gentleman is right, the Government need to get a grip on alcohol legislation. The key point is that the Government did the right thing by raising the age to 18, but they have not done the right thing in their proposals. That is the reason for new clause 1.
	The crux of amendment 1 is the evidence that the measure in the Bill would massively affect businesses in this country at this very difficult time—that was raised by my hon. Friend the Member for South-West Norfolk (Christopher Fraser). Is there sufficient evidence to ban displays at the point of sale, which will affect people's businesses? I have looked long and hard for evidence from around the world that the Government's proposals are sufficiently evidence-based, but I do not think that they are. I am sure that the Minister will refer to the experiment in Canada. When the measure was introduced in one state, there was a drop, but in states where it was not introduced, there was also a drop. What is the evidence base from that?
	The other thing that worries me about the evidence base, particularly Professor Hastings's evidence, is that it is based on what people are likely to do rather than on what they have done. I am sure that we have all been canvassing quite a lot lately and knocking on doors. If every single person who said, "Yes, I will vote for you Mike—that is my intention," did so, my majority would be about 10 times greater than it is. We all know about people stating their intent, but surely the evidence base for the Bill should be what people have done. We do not have such evidence.

Gillian Merron: I hope that hon. Members are aware that we have involved many retail organisations in the development of the draft regulations. It is not always the case that regulations are produced before a Bill is debated—far from it. Ideally, I would have liked to see them earlier, but we are ahead of time on many other provisions.

Michael Penning: There is a saying that goes, "When you get in a hole, stop digging." The industry, which sells a legal product, is very worried. It has been calling for some time for the regulations to published so that it can find out exactly what is going on.

Michael Penning: I am concerned about having good law—a law that we can enforce and one that does not have a disproportionate impact on people who are going about their law-abiding trades. That is my point.
	Looking carefully at and reading the evidence will show us that what the hon. Gentleman just said is fundamentally wrong. The evidence tells us that most children—we are talking about under-18s—do not purchase cigarettes in a shop. There is evidence of vending machine use, which I will come to in a moment, but most people are given tobacco or purchase it from an adult. There would be no impact from the measures. That is the evidence.

Christopher Fraser: Further to the point made by the hon. Member for Montgomeryshire (Lembit pik), the Association of Convenience Stores has said that the display ban could cost each store a minimum of 1,800, or even as much as 5,000. That is far too high for a store to bear in these economic times. I am sure that my hon. Friend will agree that those same store owners are scrupulous about how they sell such products, because they would not be in trade if they did not do it properly.

Michael Penning: My hon. Friend's point is absolutely crucial. Those store owners do not know exactly how much the measure will cost them, because until this morning, we had no idea what was going on. If a shop sells cigarettes to an under-age child, it should be warned, then it should receive a written warning, then it should be three strikes and out. Local government already has those powers. That process happens in some parts of the country, but it should be enforced throughout the country.

Michael Penning: If the hon. Gentleman will bear with me, I need to make some progress, and I want my Back-Bench colleagues to speak on this matter, because it is very important.
	The amount that such retailers take in revenue is not the only important thing: the footfall is also important. I would have thought that the Government, who are trying to find extra income and who are today selling off some of the nation's assetswe would agree with some of their measures, but they are having a one-off salewould have considered why they are losing more than 3 billion in duty on black market and counterfeit cigarettes, and white imports.

Patrick Cormack: I am extremely grateful that my hon. Friend touched on that point. As Chairman of the Select Committee on Northern Ireland Affairs, I know what a terrible impact such activity has had on Northern Ireland. It is not only a question of revenue lost. The illicit cigarettes that are sold are frequently highly toxicfar more toxic than the orthodox product.

Michael Penning: Three aspects of illicit tobacco worry me. The first is the duty that is not paid and the loss of income. Secondly, we have no idea what counterfeit cigarettes contain. I support the amendment on the contents of cigarettes, but we know nothing about those that are made in some dodgy shed in a field and then imported into this country. The third aspectand I saw how prevalent it is when I went to a football match at Watford the other day and saw the discarded packetsis the so-called white products, which look like legitimate products, but are made in the eastern bloc and are brought into this country for about 25p a packet and sold on. The people who sell those cigarettes do not care who buys them. One in five cigarettes sold in this country is sold on the black market. Why do we not attack that market? Why is it not a criminal offence to sell such cigarettes? It is an offence under customs legislation, but the police are not interested because it is not a recordable offence. Why not? We should drive this practice out of the pubs, clubs and markets of this country.

Mr. Deputy Speaker: I am afraid that I cannot acquiesce to the hon. Gentleman's final request. It is important that the necessary papers are available before a debate takes place. I am sure that Ministers will have heard what the hon. Gentleman has said and will instigate inquiriesas will Iinto the exact position.

Michael Penning: I was slightly surprised when the Minister said earlier that the regulations were available in the Library and the Vote Office, because such documents would usually be laid on the Table. In this case, they were not laid on the Table, which is why I mentioned that to the Minister. She should be embarrassed, because this debate is about people's livelihoods, and the impact assessments would allow Members to take a view on how this legislation would affect businesses in their constituency.
	I would also have thought that the Government would have had some comment on nicotine replacement therapy, its cost and how we can make it more available. Once people are addicted to nicotine, it is difficult to give up. The Government have a myriad of different programmes for smoking cessation, most of which I support, but the best approach is to address nicotine addiction. There must be ways to put nicotine replacement therapy closer to the consumerperhaps in the stores that would be damaged by this ban. If nicotine replacements were put next to cigarettes in shops, they would be available if people decided that they wanted to break their addiction and give up cigarettes. I am told by retailers that they are not allowed to put nicotine replacements next to cigarettes because the tobacco manufacturers say that that is not acceptable. That is wrong. Nicotine replacements should be available next to tobacco products, at a comparable price.

Christopher Chope: My hon. Friend refers to the free vote that we expect later this eveningcertainly on this side of the Housebut that does not address the issue of what will happen if the Bill becomes law in this Parliament. Will an incoming Conservative Government implement those regulations or will they accept the will of Conservative Members and reject them?

Michael Penning: We will always accept the will of the House. The draft regulations are not due to come into force until 2011, and the election will take place long before that. This House will take a view before the regulations come into force. It is as plain and simple as that.
	Evidence shows that one way in which young people gain access to cigarettes is from vending machinesalthough I do not know how they afford the cigarettes, because they are hugely expensive. I was in a local pub and a young guy came in during a quiz night and bought a packet of cigarettes from the vending machine16 for 7.20and scuttled out of the door before anyone could stop him, and we have all seen the DVD on the issue produced by ASH and Cancer Research UK. However, there are simple ways to stop young people using cigarette vending machines without destroying the income that pubs get from vending machines or restricting access to a legal product for people aged over 18. Last week, I stayed in the Jury Inn hotel in Manchester and a little sign on the vending machine said, If you wish to purchase these products, please come to the bar and prove that you are 18. Once that has been proved, the bar staff zap the machine and it works once. The Government should make proposals to address the vending machine problem without destroying a legal way to purchase cigarettes. That would make a dramatic difference. The biggest difference would be made by addressing the black market, rather than by picking on shopkeepers who are running legitimate businesses but happen to sell a product that some people do not like.

Frank Dobson: New clause 6 would require the public disclosure by tobacco companies of details of their marketing activity and research, and their scientific research. We must bear in mind that everything that tobacco companies do is designed to maximise the sale of cigarettes. In the case of scientific research, they have a long track record of denying the conclusions other people's scientific research, trying to introduce uncertainty about that research and trying to mislead the public.
	When, after the seminal research by Sir Richard Doll, it became clear to anybody who cared to listen that smoking kills, the immediate response by the tobacco industry was to say, Oh no, it doesn't. Then the tobacco industry did its own scientific research, which concluded: Yes it does, but it still continued to deny it.
	Then when people outside the tobacco industry proved scientifically that nicotine was addictive, the tobacco industry said, Oh no it isn't. Then the industry did its own research, which proved that nicotine was indeed addictive, but at that point the industry did not just continue to deny it. Rather, being the evil people that they are, those in the tobacco industry increased the proportion of the addictive part of nicotine in their cigarettes, so that they became more addictive than they were beforehand.
	Then the tobacco industry started promoting low-tar cigarettes, but when people outside said, No, they aren't better for the health of people who smoke, those in the industry said, Yes they are. Then it did its own internal scientific research, which proved yet again that the people outside the industry were right: low-tar cigarettes were no more healthy or good for smokers than the worst of them.
	Since then, the industry has been promoting all sorts of allegedly scientific surveys and pseudo-research. It has paid its way into scientific publications, hiring scientists and doctors who, for the money it has paid them, have been willing to perjure themselves and say that cigarettes are not dangerous. As far as the scientific side of things is concerned, one of the tobacco industry's objects has always been just to create as much controversy as it can and to cast doubt on the plain and simple fact that smoking kills roughly half the people who take it up.
	When we come to promotional activitythe industry's scientific research is of course related to thisone cannot fault the tobacco industry for not having long-term thinking. There is evidence from tobacco companies' internal documents going as far back as the 1970s that they were asking themselves, How do we fight off the evidence of harm that tobacco does to people? and, How do we promote cigarette sales when advertising is banned? There are legions of documentsgenerally speaking, they were revealed as a result of legal cases in the United Statesthat show what the tobacco companies have been up to.
	There has not been so much evidence here in the United Kingdom, but the situation is probably best summarised by Mr. Geoff Good, which is an odd name under the circumstances, of Imperial Tobacco, who, referring to the Tobacco Advertising and Promotion Act 2002, told a meeting in London in 2006:
	In this challenging environment, the marketing team have to become more creative.
	He would have been more accurate if he had said, Even more creative, because the industry has been getting more and more creative over the decades. The industry has promoted point-of-sale displays and sales through vending machines, and it has moved into massive promotional activity in music venues that are attended by young people.

Frank Dobson: No, I will not give way. Other people want to speak.
	Hardly anybody takes up smoking as an adult. Smoking is taken up by children or those in their late teens. Recently at the O2 Centre in Greenwichas I understand it, O2 is not one of the oxygens, but it ought to be some chemical referencethere was a tented area that was dedicated exclusively to the promotion of cigarettes. People have been going round bars in the north-east of England with illuminated trays and illuminated young women carrying them, and a similar approach has been taken on the beaches in Brighton. Those involved have been dishing out free cigarettes to British holidaymakers in Spain to ensure that they remain addicted.
	People say, Oh, these visible displays have no impact, but let me quote from a Philip Morris official who said fairly recently:
	The more visible our products are to consumers, the more sales we make.
	It is no good Opposition Members saying, Oh, there would be a damaging revenue cost if the displays were banned. If there were a revenue cost, it would mean that the ban was working. However, the industry claims that the ban would not work, but if it would not work, why is it going on about it?
	The other point is this. I have every sympathy with the small shopkeeper, but we are not talking about small shopkeepers; we are talking about some of the biggest multinational corporations in the world. The hon. Member for Hemel Hempstead (Mike Penning) said that he would like to see them go bankrupt, but they are a long way short of being bankrupt. They are rolling in money. If the small shopkeepers need help to pay to get rid of displays, they should ask the big bossesthe tobacco baronsto pay up the money and help them to conceal those displays.

Howard Stoate: Just to help my right hon. Friend with the figures, 120,000 people die each year from smoking-related diseases, which is about 400 a daythe equivalent of the number on a jumbo jet falling out of the sky. That is the number of young people whom the tobacco companies need to recruit just to maintain the level of smokers in our society.

Frank Dobson: I thank my right hon. Friend.
	My new clause 6 would force the tobacco industry to disclose all the information about its scientific and market research. At present, the people with a duty to promote public health, which includes the Governmentand, one would hope, the Oppositionas well as Parliament, are continually playing catch-up with the latest scam that the tobacco industry has come up with.
	Tonight, we have measures to try to cope with vending machines and displays, which are increasingly used for promotion. I propose that we allow people and organisations with a duty to promote public health to get ahead of the game. If we are to do that, we have to recognise what the tobacco companies really are. It is no good pretending that they are anything elsethey are merchants of death. That is not an exaggeration.

Sandra Gidley: The Liberal Democrats have tabled new clauses 4 and 7, but I want to start by talking about new clauses 1 and 4. Before I do, however, it might be worth clarifying one point. The Minister said that all Members of Parliament had been e-mailed the tobacco regulations. I have just checked my e-mail, and they were sent at 4.15 pm. Bearing it in mind that we all thought that the debate would start at 3.30 pm, it really is unacceptable that the e-mail was sent out after the planned time for the start of the debate. That gave us no chance to incorporate any comments that we might have had on the regulations. I do not know whether that was a result of the Minister's direction, or lacklustre behaviour on the part of Department of Health officials. Perhaps the Minister can clarify whether that was when the e-mail was supposed to go out.

Sandra Gidley: Thank you for that clarification, Mr. Deputy Speaker. I was just elaborating on the Minister's comments.
	New clauses 1 and 4 have the same endsto bolster this rather feeble legislation and to make it into something a bit more meaningful. We are used to eye-catching initiatives from the Government, but the tobacco display ban is probably the first example of a non-eye-catching gimmick. The ban is a gimmick, and I speak as someone who regards themselves as a bit of a tobacco health fascist. I do not like the tobacco industry. I do not like anything it stands for. I have seen at first hand what tobacco has done to close relatives. One has only to go out the back door of any hospital to see people who can hardly walk but who have managed to stagger outside for their life-destroying cigarette. There is a problem.
	Ultimately, however, I am also a scientist and a Liberal, and we are talking about an adult product. The ban has been touted as a means of reducing smoking among the under-aged. If I felt for one moment that it would do that, I would support it, but it does not, so I will be supporting provisions to remove it. As I said, we are talking about an adult product that is sold to adults.
	It is rather disappointing, therefore, that the Government resisted attempts to introduce amendments in Committee to ban proxy sales of tobacco. A variation on new clause 1 was tabled in Committee, but the Minister rejected it. She outlined some interesting statistics from a tobacco smoking survey carried out in 2006before the age for smoking was increased. She referred to 11 to 15-year-olds, 34 per cent. of whom bought from a shop, a fifth of whom were given cigarettes by friends, a tenth of whom were given them by family members and 18 per cent. of whom often bought them from other people. She claimed that the Conservative provision we were speaking to would not solve the problem, and she cited a number of incidences in which the proposed law could not be used.
	I therefore drafted new clause 4, which is based on the legislation that the Government use to prevent proxy sales of alcohol. This may be naive of me, but I assumed that the alcohol legislation is fit for purpose and that the Government would want to support a provision based on their legislation on another issue. The only reason not to support new clause 4 would be a lack of Government will to tackle the problem of proxy sales. I am told that even the tobacco retailers would not object to a provision along the lines that I propose. Whatever we might think of the product, a vast majority of retailers want to be responsible retailers. On this occasion, therefore, I hope that the Minister will not reject my proposals, because there would seem to be no reason to do so.
	New clause 6 is an interesting provision, which would ensure disclosure of tobacco industry promotional research activity. We have just heard an impassioned speech by the right hon. Member for Holborn and St. Pancras (Frank Dobson), which clearly explained the reason behind the new clause. In 2000, the Health Committee produced a report that set out in great detail some of the methods used to promote and increase tobacco sales. The current Committee, in its inquiry on alcohol, has uncovered similar devices and actions, which are quite shocking. Other supporters of the new clause will probably regale us with more detail, and I shall leave that to them so that more people have time to speak.
	I hope that commercial confidentiality is not thrown at us as a reason for not introducing my proposal. Unless information has to be provided in a very short time span, commercial confidentiality is simply not an issue. There is no detail about time scales in the legislation, so they will presumably be left to regulations. It might be helpful if any Members who are still to speak in support of the provisions could set out a time line for how they perceive the proposed openness working in practice.
	New clause 7 is an attempt to go further into the issue of plain packs. In Committee, I introduced an amendment that would require all cigarettes to be sold in plain packs. That may have been a little bold for some, and I would probably be a little inconsistent if I demanded an evidence base for a display ban when there is little evidence base as yet for plain packs. However, I instinctively feel that they must be a good idea because the tobacco manufacturers seem to hate the idea with a passion.
	New clause 7 requires the Secretary of State to consult stakeholders within six months of Royal Assent on regulations for the restriction or prohibition of branding on all tobacco products, thus potentially providing the first opportunity to introduce plain packaging for tobacco products anywhere in the world. It is now recommended as an issue for consideration under guidelines for the World Health Organisation's framework convention on tobacco controland I am sure that hon. Members will be aware that the UK is a signatory to that accord.
	We need to put the new clause into the context of the health arguments and how the tobacco industry has systematically utilised and evolved the tobacco packet with the very intentiondeliberate or otherwiseof undermining the regulations that sought to inform people and protect them from tobacco. We know that smoking kills one in every two of its long-term users and that smoking is an addiction of childhood, with 80 per cent. of smokers having started by the age of 19. There is also a crucial health inequalities aspect to smoking that cannot be ignored. We know that smoking is the single most important factor in health inequalities and accounts for half the difference in life expectancy between social classes 1 and 5, which is very disheartening. I shall return a little later to the role of tobacco packaging in exacerbating health inequalities. First, I would like to address the tobacco control context surrounding the new clause.
	The Tobacco Advertising and Promotion Act 2002 prohibited the vast majority of tobacco advertising, promotion and sponsorship, which meant that the rules of the game had changed. The tobacco industry was forced into thinking how it could be a little cleverer and refine how it interacted with its users and potential consumers. One of the prime mechanisms for interacting with consumers is now through the cigarette packet itself, which is effectively used as a badge product. Although smokers may not be familiar with the concept of cigarette packets as badge products, they will be more familiar with the notion that the tobacco industry is seeking to evokethat their brand of cigarettes reflects their identity, personality and character.
	Given such priming to personalise a smoker's relationship with the brand they smoke, it is not surprising that most adults exhibit strong brand loyalty. More than 90 per cent. of smokers have already decided which brand to buy before they walk into a shop. The tobacco industry is aware of what it is doing. A Brown  Williamson employee stated in 1995 that
	if you smoke, a cigarette pack is one of the few things you use regularly that makes a statement about you. A cigarette pack is the only thing you take out of your pocket 20 times a day and lay out for everyone to see. That's a lot different than buying your soap powder in generic packaging.
	That may well have been before mobile phones became the accessory to have, but this issue is worrying from a health inequalities perspective. Roper and Shah found that children, particularly those from deprived backgrounds, are especially attracted to tobacco brands. Once again, the supposedly glamorous issue of smoking is being supported through a branding infrastructure.
	Since 1998, the tobacco industry has sought to increase the number of brands, with the dual purpose of increasing their impact through taking up more space on the shelves while also increasing their share of the market. Benson  Hedges, for example, has increased its brand family from four in 1998 to 12 in 2008. Another function of branding is to distract from the health warnings on cigarette packets. Since January 2003, all cigarette packets have had to include a written health warning and, by 1 October 2009, a picture warning. One might wonder about the tobacco industry's response. Well, some brands actually incorporate the colours of the health warnings into the design of the pack.
	It is of course illegal for tobacco manufacturers to say that their cigarettes are low tar or light or imply that they are less harmful than other brands. The fact remains that cigarettes contain more than 80 cancer-causing substances. Now the manufacturers use the branding and colour scheme of the pack to imply distinctions, through colours such as silver and white. For example, research by Ann McNeill at Nottingham university and other partners found that
	products bearing the word 'smooth' or using lighter coloured branding mislead people into thinking that these products are less harmful to their health.
	Let me provide a practical example in case anyone does not believe me. This research found that
	compared to Marlboro packs with a red logo, cigarettes in packs with a gold logo were rated as lower health risk by 53 per cent. and easier to quit by 31 per cent. of adult smokers.
	Consumers are deliberately being led to make distinctions between products that are essentially identical and, crucially, do not have any differential health benefit or impact.
	What could be the impact of plain packaging on tobacco products? Well, it would deglamorise them. Studies by Wakefield et al have found that plainer tobacco packaging can make the product seem dull and boring. Indeed, without all the branding, what do these packets become? They become simply containers of tobacco products, rather than a brand for a smoker to build a relationship with. Such a move would be seriously fought by the tobacco industry, and it is already on their radar.

Judy Mallaber: rose

David Taylor: rose

Christopher Fraser: Does the hon. Lady accept that a figure of between 1,850 and 5,000 is far too much for a small retailer to bear?

Sandra Gidley: Yes.
	I hope the House will excuse me if I say a little about vending machines. I have tried to be brief in dealing with matters raised in other amendments. A significant proportion of children buy their cigarettes from vending machines, and here the Government have again been very timid. No other age-related products can be sold in the same way. I shall leave it to those who tabled the amendment to present their arguments, but there is widespread support for the banning of such vending machines, and I feel that the Government are behind the curve in this respect.
	Amendment 17 supports a sentiment first expressed by my hon. Friend the Member for Leeds, North-West (Greg Mulholland), who suggested on Second Reading that a compromise might be to restrict vending machines to premises to which only those over 18 had access. I am not sure how practical that isI do not know whether clubs for over-18s can employ 16-year-old cleanersbut it is an interesting attempt.
	The Government have chosen a single eye-catching initiative in an attempt to show that they are doing something about tobacco control. They have chosen the wrong measures, however, and I hope they will listen seriously to what is said about some of the amendments tabled by both Opposition and Labour Members, which in my view would do much more to control tobacco use than the path they have chosen to pursue.

Ian McCartney: I owe the House an explanation. Because of the complexity of some of the new clauses and amendments that we are discussing and the overlap in what we are attempting to achieve, I shall pursue amendments 5 to 8, relating to clause 22 and England and Wales, and amendments 11 to 14, relating to clause 23, which deals with Northern Ireland. I am assured by my ministerial colleagues that if the amendments that I am pursuing are accepted, that will ensure that cigarette vending machines are put out of order for good to help to protect the future health of our children. I ask all Members not to find a way of frustrating the will of the House, but to find a way of ensuring that future generations of children do not die unnecessarily as a result of cigarettes purchased from vending machines.
	On 8 June, on Second Reading, I presented what I considered to be an evidence-based and compelling case for an outright ban on cigarette vending machines. I implored my right hon. Friend the then new Secretary of State
	to be brave and not to take heed of those who claim that this would be a regulation too far.[ Official Report, 8 June 2009; Vol. 493, c. 604.]
	I hope that that is exactly what he and his colleagues will do in the Lobby tonight.
	My amendments test the resolve of the House in attempting to close an outrageous loophole in safeguards intended to prevent tens of thousands of children from illness and premature deaths in the years to come. We require the Secretary of State to regulate to prohibit the sale of tobacco from vending machines. Why do we need to do more? Smoking is an addiction of childhood, not an adult choice. Members may come here tonight and argue that it is to do with adult choice, but it is no such thing. More than 80 per cent. of people who start smoking before the age of 19 are hooked by then, and each year in this country people start smoking when they are as young as 10 or 11. Each year, 340,000 children in Britain start smoking, and are addicted well before they reached the age of 19.
	However, it is not just a question of addiction. Members spoke earlier about the human carnage. Each year, the industry secures more than 100,000 new recruits who are not adults but children as young as 10. If the industry is to survive, it must replace the adults whom it killsand it can do that only by replacing them with children. Tragically, year after year in my constituency and in the north-west of England as a whole, 14,000 of my fellow adult citizens die prematurely. People my age and younger will never see their children leave school, and will never see their grandchildren grow up. Why? Because they became addicted to smoking as children, and lose their lives because of it.
	Tobacco is still the only product in Britain that can be sold legally which routinely, as a matter of coursedaily and recurrentlykills and injures its consumers. Do not tell me that we cannot have choices! For too long the choices have been left in the hands of the tobacco industry, and they all end up as one choice: for families to watch debilitating diseases overcome their loved ones. My friend John Tiernan, who was diagnosed with cancer of both lungs at the age of 30, started smoking at 11. By the age of 31 he was dead, leaving a widow and two young children. John is not unique as a friend. We all have friends and family members to whom similar things have happened.
	Smoking is the biggest health inequality indicator, accounting for 50 per cent. of the difference in life expectancy between working-class and middle-class citizens. Why? Because of its deleterious effects on our constituents.

Ian McCartney: If the hon. Gentleman is such an apologist for the tobacco industry, perhaps he would like to apologise to the House for the most distasteful remarks I have heard in the Chamber in 23 years. When we are trying seriously to defend the interests of young children from the effects of tobacco smoking, all that the hon. Gentleman can produce is a quip which is not worthy of response other than this: I have given you 100,000-plus reasons why every year we should ensure that this product does not get into the hands of our children. I will give you 340,000 reasons

Ian McCartney: I realise that I should not use the word you. I could call the hon. Gentleman comrade; I could call him the best of mates. I could call him a host of things, but I thought you was as neutral a word as I could use in the moment. I do apologise, however. I am making this point to the hon. Gentleman: learn and grow up. He should realise that today in his constituency he has constituents who are dying prematurely because of the tobacco industry.
	Yesterday, I attended a conference of 100 young people in Chester, many of them smokers. They took a vote and they asked me to tell the House tonight. Nine out of 10 of them voted to have a strict ban on vending machines. Young people are speaking up and speaking out, and two thirds of smokers argue that there should be a ban on vending machines. Why? Because vending machines are almost exclusively used by children.
	Vending machines are a danger; they are a loophole. This country rightly took the decision to secure a rise from 16 to 18 years for the age that children and young adults can buy cigarettes. There is a reason for that: by the age of 19 more than 80 per cent. of young people who have started smoking are addicted to smoking. Yet that ban has been undermined by the industry through the use of vending machines. Children use these machines on a daily basis in disproportionately high numbers; tens of thousands of children, some as young as 10 and 11, are using vending machines, when the overwhelming majority of this country's citizens say young people should not be able to buy cigarettes until the age of 18. Vending machines are not just a loophole; they are a death trap to the next generation of young people, who will be captured by an industry that needs them to replace the adults who it is already killing on a daily basis.
	I ask my colleagues to support the amendments. I could say much more, but other Members wish to speak so I will let later contributors add to my remarks. The evidence is overwhelming: if we do not get rid of vending machines some people will consistently undermine the 18-years-of-age ban. We know from all the professional surveys done so far that in pubs, clubs and wherever else vending machines are located, people as young as 11, 12, 13, 14 and 15 can access those machines with impunity. Therefore, the only safe way of dealing with this issue is to ban vending machines once and for all, and with this ban we will take another step down the road of making Britain a smoke-free nation. With that, tens of thousands of our fellow citizens will be able to grow up, see their children and grandchildren grow up, and see their grandchildren's children be the best they can be. If that is all we can do in this House tonight, please let us do that; let us save the next generation of children from diseases of the heart and cancers. We owe that to them; let us vote for this measure.

Judy Mallaber: Does the hon. Gentleman not accept that one person's choice to smoke affects other people's choice not to smoke? One person's freedom stops at my nose when it comes to smoking. Although in this issue we are concerned particularly about young people, does he not accept that one person's choice affects others' freedoms?

Philip Davies: My hon. Friend is absolutely right.
	The main point is that this should not be billed as the tobacco display restriction or ban. The Government should be promoting this measure as, We think the public are thick because in effect they are saying that people will buy cigarettes only if they are on display and that they will not buy them otherwisethat if they are on display people will think they therefore must be an attractive product and will buy them. That is a completely false premise. People have a choice as to whether they want to buy them. I am perfectly prepared to trust my constituents to make these decisions for themselves. I trust them to be able to decide for themselves whether they want to buy a packet of cigarettes. They do not need the Government telling them what they can and cannot do, and what they can and cannot see when they go shopping.
	This is the nanny state gone mad. Everything that the Government do always has at the back of it this: that they know better than the public who elected them. I do not see why they have such little faith in the public when they stand for election hoping that people will choose who to vote for, yet they cannot even allow them to make a choice as to how they buy a particular brand of product. On every conceivable level this proposed ban is wrong, because it goes against the principle of individual responsibility, free choice and people making their own decisions, and it will have a very bad effect on small shops.

Philip Davies: No, I do not accept that because, again, the premise is wrong. That basically presumes that everybody who buys cigarettes from a vending machine is a child, but that is clearly palpably ridiculous.
	I might add that we were talking about the future of local shops, but one other serious issue we ought to face up to is the problem of local pubs. Many local pubs have gone out of business over the last few years, not least because of the ban on smoking supported by so many Labour Members who have helped the small pubs in their local communities go to the wall. About 50 pubs a week are closing down. Lots of Labour Members doubtless argue that they want their local pubs to thrive, but taking the vending machines out of pubsplaces that, again, are largely inhabited by adultswill not make a blind bit of difference to under-age smoking and will have a huge impact on local pubs.

Philip Davies: I have great respect for my hon. Friend's opinions and on that, as on so many other things, I agree with her entirely. The whole principle of the nanny state is wrong, but even if one were to think that it is a good thing, one would find that in other countries such a ban has been shown not to have the effect that the Government would like it to have. For example, after years of decline in the level of under-age smoking in Canada, among 15 to 19-year-olds smoking has remained the same or has increased in five of Canada's eight provinces since the ban was implemented. Whereas there had been a fall in the number of young people smoking in Canada before the ban, in five of the eight provinces there has since been either no reduction or an increase. This measure has been shown not to work.
	In Ireland, the introduction of a ban has only made the black market worse; for the first time in Ireland, illegal products have been found in traditional retail outlets. That evidence from so close to home surely shows that these concerns are justified and should be taken seriously. Even if one accepts that telling everybody what they can and cannot do, where they can and cannot shop and what they can and cannot see is a good thing, this ban has been shown in other countries to be a complete waste of time. This measure is a perfect example of the Government thrashing around to try to do somethingto look as if they are doing somethingeven if what they do will make no difference or do great damage to local businesses and shops.
	The right hon. Member for Holborn and St. Pancras made the point that the tobacco companies would be able to pay for all the changes required by retailers in their shops, but I must tell him that in Ireland that is not the evidence from most retailers. Well over half the retailers there got zero help from the tobacco companies to pay for their displays and some 75 per cent. of the smallest shops of allnewsagentshad to pay the full cost themselves. There is no evidence that all these costs will be met by the tobacco companies.

Philip Davies: It is not sensible, in the current climate, for any Member of Parliament to accuse anyone else of being greedy and grasping; I am not sure that there would be much public support for an MP calling anybody else that in the current climate. The right hon. Gentleman criticises tobacco companies for being wealthy, but they have lots of money only because they have sold legitimatelegalproducts to people who have bought them as a result of their own choice. He might not agree with people's decision to smokeI do not smoke and I do not particularly like going into smoky places, but I believe in freedom of choicebut they should be respected if they decide to spend their hard-earned money on cigarettes. If that is what people wish to do, they should be free to do sothey do not need him lecturing them.

Philip Davies: I knew it was a mistake to give way to the right hon. Gentleman and I shall treat that intervention with the contempt that it deserves. This issue is all about choice. I choose not to smoke but I perfectly respect people who choose to do so, because that is their choice. He has just proved to me what I said from the word go: that he comes into Parliament to try to ban everybody else from doing all the things that he does not like. That is not a good basis on which to pass laws.
	I shall conclude my remarks, because I know that others wish to speak, but I urge the House not to allow yet another triumph for the nanny state and for intolerance. I have seen such triumphs time and again since I was elected. If Labour Members want to ban tobacco altogetherthat seems to have been the basis of their argumentthey should at least have the courage to come to this House to argue for what they really believe in and face the consequences. They do not do so because they are scared of public opinion on that issue and instead come along with weasel tactics in order to try to stop people from doing something that they do not like. To be perfectly honest, I have had enough of this nanny state and I hope that the House will show tonight that it has too.

Gillian Merron: I have listened closely to the debate and know that all hon. Members want to prevent young people from taking up smoking and to support smokers who want to quit. Clearly there are differing opinions about how we best do that, but the case for action, to which this Bill gives effect, is compelling. We know that smoking is the single biggest cause of preventable illness and premature death in England. Smoking kills more than 80,000 people each yearthat is the equivalent of wiping out nearly the entire population of Durham, and it is more than the number who die from suicide, alcohol, road traffic accidents, illicit drugs and diabetes combined. Smoking is the primary reason for the gap in life expectancy between rich and poor. The Royal College of Physicians tells us that smoking is positively associated with more than 40 diseases, and the list continues to grow. We also know that in 2007, nearly 200,000 children between 11 and 15 were already regular smokers. Some two thirds of current and past smokers say that they started smoking regularly before they were 18.
	The measures contained in the Bill are part of the wider fight against smoking. Since 1997, the Government have banned tobacco advertising, raised the age of sale to 18 and introduced hard-hitting picture warnings on cigarette packets. Research shows that the decision in 2007 to go smoke-free is now supported by more than 80 per cent. of the population. Since 1997, our actions on smoking have resulted in 2 million fewer smokersthat is a 25 per cent. reduction. In the past decade, more than 70,000 lives have been saved by local NHS stop smoking services, yet about one in five people still smoke, with the highest concentration in the most disadvantaged communities and groups.

Joan Walley: Is my hon. Friend aware of the concerns of the NHS in Stoke-on-Trent, particularly in respect of the very high numberthe figure is well above the national averageof 11 to 16-year-olds who classify themselves as regular smokers? Does she agree that it is right that this Government should do all they can to reduce smoking, including among young people, and that we must go even further than the measures in the Bill?

Gillian Merron: I agree with my hon. Friend that we should do all we can. A consultation that we undertook last year attracted almost 100,000 responses, and I shall be publishing the new national tobacco control strategy later this year. I am sure that my hon. Friend and her constituents will be interested to see what is in it.
	Amendment 1, as tabled by the hon. Members for Hemel Hempstead (Mike Penning) and for Eddisbury (Mr. O'Brien), would prevent the prohibition of tobacco displays. Since clamping down on advertising and marketing, the tobacco industry has found other ways to recruit new smokers, including the promotion of tobacco at the point of sale. We have seen larger displays, illuminated cabinets, branded clocks and locked towers, which serve no practical purpose, other than promoting sales.
	Evidence backs our focus on ending tobacco displays, as demonstrated by a letter in  The Times today in support of the provisions in the Bill, backed by the British Lung Foundation, the British Heart Foundation, Cancer Research UK, the British Medical Association and Asthma UK. It states:
	There is strong evidencebacked by the World Health Organisation and other leading medical expertsthat these measures will help to stop children smoking.

Several hon. Members: rose

Gillian Merron: I will take some interventions, but perhaps it would be helpful if I set out a few more points that I think will help the debate.
	This morning, I received a letter from my counterpart in the Irish Government, who wanted to make it clear that the introduction of similar measures on display in Ireland was successful: no prosecutions have been carried out, compliance has been good and there is no evidence of any increase in illicit cigarette sales. In fact, initial results from research on the impact of the Irish legislation are striking. They show that since the law came into effect in July, public support for tobacco control has grown from 56 to 68 per cent., far fewer young people recall seeing tobacco packs in shops, and the number of under-age people who thought they could successfully buy cigarettes decreased from a third to a quarter. Point-of-sale advertising directly affects young people's smoking. Studies show that tobacco marketing generates new smokers, that young people are receptive to tobacco advertising and that promotion undermines the efforts of those who want to quit.
	I appreciate that there has been much debate about the evidence to justify removing displays, which is why I invited all hon. Members to the meeting I held earlier so that we could hear from experts what the peer-reviewed evidence shows. I am confident that there is convincing publicly available evidencefrom Canada and Iceland as well as from Irelandto justify removing tobacco displays. Cancer Research UK, in summarising much of the relevant publicly available evidence, tells us that there is clear evidence that
	tobacco point of sale has a direct impact on young people's smoking
	and that
	Among established smokers, point of sale does not facilitate brand choice...it stimulates impulse purchases and undermines efforts of smokers to quit.

David Taylor: Was the Minister as shocked as I was by the deliberate exaggeration of the costs that we heard from the Opposition early on in the debate? To put a few doors on displays and flaps on shelves surely costs only 100 or 200. We have heard estimates of 10,000 or 1,800. Those figures are designed to frighten newsagents and others. It cannot be true, and I hope that she will lance that particular lie.

Gillian Merron: I would always rather deal in facts. My hon. Friend is quite right about the reality of costs. The estimate from Canada that we are using is something in the order of 450, but that includes fitting and shipping. I would expect to see British innovation and I would also expect the solutions, which are completely flexible, to be used first by the larger shops, so that the smaller shops will be able to benefit from them.

Gillian Merron: I have of course considered amendment 16, tabled by the hon. Gentleman, and I hope that he will not press it to a Division. Display, partial or full, constitutes promotion and allowing any display, as permitted by that amendment, would effectively allow tobacco promotion to continue.
	Let me attend to more of the concerns

Julie Morgan: rose

Madeleine Moon: rose

Gillian Merron: I will give way if my hon. Friends give me a moment.
	It has been suggested that removing the display of tobacco would impact on business by reducing footfall tradethat is, the sale of other items to customers who come to buy cigarettes. By definition, by the time that a customer is in the shop their foot has already fallen. Of course, the provisions in the Bill will apply equally to all tobacco retailers.

Madeleine Moon: I attended a meeting with the Porthcawl cancer research campaign. The group gave me a petition collected from across the town, which said very strongly that people wanted the removal of tobacco advertising displays from our shops. It felt very stronglyit consisted of a group of smokers, ex-smokers and non-smokersthat the temptation was there, especially for young people, and that is something that we must remove.

Gillian Merron: I am grateful for my hon. Friend's support on that point.
	We are particularly aware of the way in which the economic climate has affected small business, which is why we will not commence this legislation until 2011 for larger stores, and 2013 for smaller shops. We understand, too, that smaller convenience stores replace their tobacco gantries every five years or so, and thus for many of them changes could be made in the normal cycle. I want to reassure the House, however, that we will keep implementation under close review, and we will monitor levels of compliance and the effect of the policy.
	We are working hard to support the convenience store sector, recognising that local shops are at the heart of our communities and can support our public health aims. For example, the Change 4 Life scheme, which brings fresh fruit and vegetables to the fore in the most disadvantaged communities, has been so successful that some shops have chosen to fund themselves to join in. There is an opportunity for retailers to become an active part of a movement for better health, and I therefore urge the hon. Member for Montgomeryshire (Lembit pik) not to press his amendment.
	New clauses 1 and 4 deal with proxy purchasing. We all agree that reducing children's access to tobacco is a priority, and I very much appreciate the intent behind the new clauses. However, creating an offence for proxy purchasing of tobacco would be difficult to implement and enforce. The new clauses would require proof of intent at the point of purchase, and proof of a young person asking an adult to buy tobacco on their behalf.

Sandra Gidley: rose

Gillian Merron: Will the hon. Lady allow me to make the case?
	That evidence would be needed to secure a conviction. While there has been a proxy purchasing offence for alcohol since November 2005, it is a difficult offence to prove, and the Home Office accepts that it is not being enforced as rigorously as we would like. I would also hesitate to place a new requirement on local authorities that would require them to observe shops and customers without significant benefits being achieved. Better enforcement of existing legislation is likely to be more effective than adding another offence that is difficult to enforce.
	I would also like to make a technical point about the wording of new clause 4, which appears to have been lifted directly from the Licensing Act 2003, and speaks of members of clubs and tobacco consumption on relevant premises. We know that smoking inside premises open to the public, including members' clubs, is no longer permitted under smoke-free legislation, so the wording will not work for the purpose for which it is intended.
	Purchasing tobacco with intent to supply young people is only one small part of a wider, more complex problem. Children are given cigarettes that have not been specifically purchased for them, they pass them on to one another at school, and they get them from vending machines. Our new tobacco control strategy will set out our plans on how we will tackle this complex problem. I can assure hon. Members that if it becomes clear that legislation would prove to be beneficial, I would indeed seek to make the case.

Sandra Gidley: Is the Minister saying that the Government's legislation on alcohol proxy sales is ineffective? Perhaps she could tell us how many prosecutions there have been, to explain why, if it is such a failure, they cannot introduce similar mechanisms for tobacco?

Michael Penning: The principle is exactly the same, and an identical piece of legislation has been proposed this evening. The 2003 Act is working, particularly in Cambridge, to which I alluded earlier. Where there is the willpeople actually want to do itit can be done. Running away from the fact that this is going on is not the answer.

Gillian Merron: We are not running awaywe are saying that we are going to do better. I want to assure hon. Members that I very much understand the problem at hand. I urge them not to press their new clauses, and I look forward to the new tobacco control strategy, which will be far more comprehensive.
	The provisions in the Bill seek to restrict or ban tobacco vending machines. The question before the House is how far it wants to go and how fast. These are finely balanced considerations which reflect the strength of feeling on this issue. To clarify, amendments 2 and 9 would compel the national authorities of England, Wales and Northern Ireland to make regulations on vending machines under clauses 22 and 23. It is not possible to accept amendments 2 and 9, which would change the wording from may to shall, as the word shall would place a legal obligation on the appropriate national authority to regulate. The adoption of regulations would be subject to parliamentary approval. If Parliament or the relevant Assembly refused to approve any regulations that were laid, the appropriate national authority would be faced with a continuing obligation to try and make regulations, knowing that Parliament is unlikely to approve them. That would create legal uncertainty and the prospect of continuing legal challenge for not having made regulations.
	Amendments 4 and 10, too, would create legal uncertainty, as the circumstances in which the powers could be used in those amendments are unclear. Amendments 17 and 18 seek to restrict the location of vending machines to areas used by over-18s. In practice, matters are not so straightforward, as places that are for over-18s in the evening may be open to young people during the day. The remaining amendments tabled by my right hon. Friend the Member for Makerfield (Mr. McCartney) and by the hon. Member for Colchester (Bob Russell) would seek an outright ban on vending machines in England, Wales and Northern Ireland. The Government remain seriously concerned about young people accessing tobacco from vending machines. Currently they are the usual source of cigarettes for 10 per cent. of 11 to 15-year-olds who say they smoke.
	We have heard a range of arguments about how far we should go to control access to vending machines. We know one thing for sure: the evidence for action is clear. The Government believe that we can place requirements on vending machines that will be effective, proportionate and deliverable in preventing under-age sales and balance the views of all concerned. However, I ask right hon. and hon. Members not to press amendments 2, 4, 9, 10, 17 and 18. On the remaining amendments, I note that my right hon. Friend may wish to test the will of the House.
	New clause 6, tabled by my right hon. Friend the Member for Holborn and St. Pancras (Frank Dobson), would compel the Secretary of State to require all tobacco companies to release information about their marketing and research activities. I appreciate the sentiment behind the amendment, but before the Government could implement such a measure, we would need to consider carefully the burdens placed on business and Government alike, confidentiality, proportionality and, most importantly, its effectiveness. On balance, we cannot accept the amendment, so I ask my right hon. Friend to not to press new clause 6.
	New clause 7 would compel the Secretary of State to consult on the introduction of plain packaging requirements or restrictions on the branding on packaging. I have sympathy with the aims of the amendment. We have already stated that the Government will continue to keep tobacco packaging under close review. There is emerging evidence that branding and design of tobacco packaging may increase brand awareness among young people. The new strategy on tobacco control will consider a range of options for protecting children and people who smoke from misleading or promotional messages and packaging, and we will ensure that the evidence, which is still wanting, on plain packaging is further developed. On that basis, I ask the hon. Member for Romsey (Sandra Gidley) not to press new clause 7.
	The Government remain committed to cutting preventable death and disease from smoking. I sincerely hope that the votes tonight will back us up in our efforts.

Stephen O'Brien: I beg to move amendment 19, page 2, line 3, at end insert
	'and the core principles of the NHS.
	(1A) The core principles of the NHS are that
	(a) the NHS provides a comprehensive service, available to all;
	(b) access to NHS services is based on clinical need, not an individual's ability to pay;
	(c) the NHS aspires to the highest standards of excellence and professionalism;
	(d) NHS services must reflect the needs and preferences of patients, their families and their carers;
	(e) the NHS works across organisational boundaries and in partnership with other organisations in the interests of patients, local communities and the wider population;
	(f) the NHS is committed to providing best value for taxpayers' money and the most effective, fair and sustainable use of finite resources; and
	(g) the NHS is accountable to the public, communities and patients it serves.'.

Madam Deputy Speaker: With this it will be convenient to discuss the following: Amendment 15, page 3, line 6, clause 3, leave out subsection (2) and insert
	'(2) The Secretary of State must undertake a short review of the NHS Constitution within the first two years of operation and, thereafter, at least once in any period of 10 years the Secretary of State must carry out a full review (a 10 year review).'.
	Amendment 20, page 4, line 9, clause 4, at end insert
	'(1A) The Secretary of State must revise the NHS Constitution in the light of relevant findings of the Care Quality Commission or the National Patient Safety Agency.'.

Mike O'Brien: We are the party that introduced the NHS constitution. We certainly want to ensure that it sets out the guiding principles to the NHS, but not to turn it, as the hon. Member for Eddisbury (Mr. O'Brien) appears to want to, into exactly what he referred toa lawyer's charter. I use exactly the same phrase as he did because that is precisely what we need to avoid. It is supposed to be a declaratory document, not a legal one. We need to ensure that the NHS is the area where this decision-making takes place, not the courts. Equally, if the NHS's principles were enshrined in primary legislation, that would rigidify and fix them in a way that meant that they could not be adapted as medicine and the NHS change. The result would be inflexibility in how the constitution develops.
	We need to ensure that the NHS can move with the times and adapt when it needs to, and that it has the flexibility to develop its constitution in a way that responds to patients. The hon. Gentleman's proposal would prevent all that and ensure that the courts constantly intervened with detailed legal decisions. Difficult decisions that are currently made within the NHS would instead have to be referred to the courts by way of judicial review again and again. He knows, and I know, that issues related to the NHS can require difficult decisions. If we abrogate those decisions to the courts across the board, we will create substantial difficulties and delays.
	Amendment 15, tabled by the hon. Members for Romsey (Sandra Gidley) and for Southport (Dr. Pugh), would require the Secretary of State to conduct a review of the NHS constitution within two years of its coming into effect. The constitution will be able to be examined constantly to ensure that it adapts. We will avoid the rigidity that the Conservative Front Benchers want, and we will be able to undertake the type of review that the hon. Member for Romsey wants, but we do not want to fix a review in time. We need to ensure that the NHS constitution can be kept under regular reviewwhether in two, three or four years. I therefore hope that she will not press her proposal.
	Amendment 20, tabled by the hon. Member for Wyre Forest (Dr. Taylor), would require the NHS constitution to be revised in the light of the findings of the Care Quality Commission and the National Patient Safety Agency. Although I commend the hon. Gentleman's intention and sentiment, the provision of high-quality care in a safe environment is at the heart of NHS values, and I am sure that we can agree that we want the NHS to deliver high-quality care across the board. The good work of the CQC and the NPSA helps to support that, and both will continue to play an important role as we move forward.

Mike O'Brien: We certainly need to ensure that we do not have another Mid Staffordshire hospital situation and that the CQC, which has now replaced the Healthcare Commission, can produce reports on individual hospitals, receive references from individuals who feel that there are problems in particular trusts and act upon those references. I do not believe that we need to enshrine that in the constitution, but we do need to ensure that we can deal with issues such as that at Mid Staffordshire quickly.
	In the Bill, we have ensured that unlike in the past, and unlike what recently happened in Mid Staffordshire, when a problem arises Ministers will have the ability to call upon Monitor to de-authorise a foundation trust, which will ensure that they can take action. We feel some sympathy with the hon. Gentleman's sentiments, but we believe that enshrining the matter in legislation in the way that he proposes is unnecessary. The involvement of the CQC and the NPSA will be important elements in the process.
	In determining whether it is necessary to amend the constitution, we will consider a range of factors, including changes in departmental policy or the law. Patient safety and clinical quality are central to everything that the NHS does. The rights contained in the constitution already reflect that. We introduced the constitution and we want to ensure that it works. We do not want it to become a lawyer's charter. We want it to be effective and we want to ensure that the Government are the Governmentand, indeed, the partythat protect and defend the NHS.

Question accordingly negatived.
	 The Deputy Speaker then put forthwith the Questions necessary for the disposal of the business to be concluded at that  time ( Standing Order No. 83E).

Amendments made: 21, page 13 leave out lines 20 and 21 and insert
	'(5) Schedule 8A makes further provision about trusts in respect of which an order is made under subsection (1).'.
	Amendment 22, in page 17, line 15, leave out Clause 16. ( Mary Creagh .)

Amendments made: 23, page 22, line 25, leave out 'Chapter 5A does' and insert
	'sections 52B to 52E and Chapter 5A do'.
	Amendment 24, page 22, line 36, at end insert
	'( ) section 52D(1) or (7) or 52E(6),'.
	Amendment 25, page 22, line 37, leave out 'or (4)' and insert ',(4) or (5)'.
	Amendment 26, in page 22, line 39, at end insert '52D(1), 52E(6),'.
	Amendment 27, page 23, line 2, leave out '10A' and insert '8A'.
	Amendment 28, page 23, line 3, after 'section', insert '52D(1) or'.
	Amendment 29, page 23, line 12, after 'section', insert '52D(1) or'. ( Mary Creagh .)
	 Amendment proposed: 1, page 23, line 31, leave out Clause 21. (Mike Penning.)
	 Question put, That the amendment be made.
	 The House divided: Ayes 180, Noes 288.

Amendment proposed: 5, page 26, line 4, leave out
	'or imposing requirements in relation to'. (Mr. McCartney.)
	 Question put, That the amendment be made.
	 A Division was called off.

Amendment made: 38, page 35, line 30, at end insert
	'( ) section [Payments in respect of costs of optical appliances];' ( Mary Creagh .)

Amendments made: 30, page 39, line 24, leave out '10' and insert '8'.
	Amendment 31, page 39, line 25, leave out '10A' and insert '8A'.
	Amendment 32, page 39, leave out lines 28 to 31 and insert
	'(1) This Schedule applies to a body which is an NHS trust by virtue of an order made under section 52D(1) or 65E(1) (a de-authorisation order).'.
	Amendment 33, page 40, line 7, at beginning insert
	'() This paragraph is subject to any provision made under section 52D(4) or (7) or 65L(4) or (5).'.
	Amendment 34, page 40, line 11, leave out 'order under section 65E(1)' and insert 'de-authorisation order'.
	Amendment 35, page 40, line 17, at beginning insert
	'() This paragraph applies only to a body which is an NHS trust by virtue of an order made under section 65E(1), and is subject to any provision made under section 65L(4).'.
	Amendment 36, page 40, line 20, leave out 'order under section 65E(1)' and insert 'de-authorisation order'.
	Amendment 37, in page 40, line 36 [Schedule 2], leave out 'order under section 65E(1)' and insert 'de-authorisation order'. ( Mary Creagh. .)

Amendment made: 39, page 68, line 18 , column 2, at end insert
	
		
			  'Section 180(2)(c).' 
		
	
	. (Gillian Merron.)
	 Question agreed to.

Lembit �pik: On a point of order, Madam Deputy Speaker. I have waited until now to draw your attention to the fact that there was no call for a vote on my amendmentamendment 16and, indeed, I was not called to speak to it. I seek your guidance on whether there is anything I can do to raise my concerns, given that the amendment represented the only compromise option on the table in terms of the display of cigarettes.
	I do not seek to challenge your authority, Madam Deputy Speaker, but I know that this decision was worth hundreds of millions of pounds to the newsagents. I am in your hands when I ask whether there is any step that I can take to ensure that the matter is reviewed.

Madam Deputy Speaker: I understand the hon. Gentleman's concern, but he will not be surprised when I say that there is nothing I can do to assist him at this stage in the proceedings.
	 Third Reading
	 Motion made, and Question proposed, That the Bill be now read the Third time. (Mary Creagh.)

Andrew Lansley: Happily, the Secretary of State is now present for the debate on Third Reading [ Interruption. ]

Andrew Lansley: Thank you, Madam Deputy Speaker.
	Notwithstanding the recent debates on tobacco, at the heart of the Bill was the intention that incorporating the NHS constitution and measures relating to quality and innovation in the Bill should drive forward an improvement in the quality of health care for the people of this country. We made it clear to Ministers from the outsetmy right hon. Friend the Leader of the Opposition and I had made it clear for a considerable timethat we wanted an NHS constitution, and believed in the importance of incorporating the principles of that constitution and making clearer to the public the nature of their rights and entitlements and, indeed, the obligations they should have.
	I am pleased that the Bill has enabled the NHS constitution to be referred to in legislation, but unfortunately, in these latter stages, Ministers have chosen not to incorporate its core principles directly in the legislation. I must confess that I find it astonishing that the Minister of State should have thought that expressing the core principles in legislation would, of itself, lead to litigation about those core principles, given that in any case the purpose of the NHS constitution is that every NHS bodyor those contracted to provide services for the NHSshould have regard to those principles. If the Minister is suggesting that by leaving them out of the Bill, he leaves them out of the legal duties placed on NHS bodies and those NHS contractors, I am afraid that that simply serves to undermine his own argument.
	As we know, the core principles of the NHS were stated by Ministers in the NHS plan in 2000. As Minister of State, the Secretary of State launched a consultation on the subject, and arbitrarily changed what he regarded as core principles. Perhaps he intends to change them once again. As I recall, when he introduced them he left out the principle that resources provided for the NHS should be used solely for the benefit of NHS patients.
	I am afraid that the Bill does not drive forward reform and does not drive forward quality. We did not discuss this evening, but at an earlier stage, the obligation to produce quality accounts. I have to hand the quality report produced by the Wrightington, Wigan and Leigh NHS Foundation Trust, which is the Secretary of State's local hospital. As a result of it, he will know perfectly well that nothing prevents a requirement from being placed on hospital trusts, or prevents him from providing for such an obligation on primary care trusts, without it having to be written into legislation. We also learn that the publication of quality accounts will essentially be a self-justificatory exercise on the part of NHS bodies; they will choose what constitutes quality when they present them.
	However, I do not want to be anything other than generous in approach at this late stage in the consideration of the Bill. It contains necessary and helpful measures, such as the incorporation of the NHS constitution, but we know that we will have to go further in future. The incorporation of direct payments into legislation is a good thing as well. I am delighted that, whereas the Government resisted our view that direct payments should be able to be extended to incorporate health and social care three and a half years ago, we have now arrived at the point of their having come round to that way of thinking.
	I am also pleased that the Government have legislated for the investigation of complaints about privately arranged or funded adult social care. I just hope that when Ministers come to reply to this short debate, they will say that they will be able to make progress in the next few months on incorporating that. A lot of people whose social care is arranged privately will continue to be without that protection unless there is fast progress.
	It was also important for the House to have an opportunity to look at the issues relating to tobacco, although I may not agree with all the conclusions that it reached. The amendment of the right hon. Member for Makerfield (Mr. McCartney) has been passed, doubtless with discussions between him and the Government Front-Bench team, but there is a question that I need to ask if he does not: what is their intention in relation to these regulations? Our view is that to make regulations that would ban all vending machines would be disproportionate, but the Government seem to have acquiesced and voted for this power, so is it their intention to use such a power, or not? We shall see; perhaps Ministers will tell us.
	Finally, I am disappointed at this late stage in what the Government have demonstrated in their reaction in the past two months to the Mid Staffs situation. We debated that earlier so I will not return to all the issues, but I am afraid that their inclusion of the de-authorisation provisions is a further indication that they have given up on the reform process they were pursuing a few years ago. According to former Prime Minister Tony Blair, foundation trusts were integral to that reform process, yet Ministers have not only stalled on the process of creating foundation trusts but are now actively seeking to de-authorise them and are looking for opportunities to do so. We know that they have abandoned any willing provider as a basis for introducing competition into the provision of NHS services, and we know that measures to do with patient choice and practice-based commissioning have also been stalled, so some measures that would best deliver improved quality in the NHS through reform processes in the service have been undermined by decisions that are now being taken by the Government.
	Therefore, this Bill is not a flagship for reform; rather, it is a portmanteau Bill. It contains measures that we welcome, and others that will be good or bad depending on how they are used, such as pharmaceutical needs assessments; but it will not, in itself, achieve a substantial shift forward in quality, innovation and performance across the NHS, because it is no more than a collection of modest changes. To that extent, although there are measures that the Government have included in the Billnot least todayto which we object, we will not resist it at this stage. However, I encourage those who have yet to consider it in another place to look very hard and critically, not least at the de-authorisation of NHS foundation trusts.
	May I conclude by thanking my colleagues my hon. Friends the Members for Eddisbury (Mr. O'Brien) and for Hemel Hempstead (Mike Penning), who have done all the heavy lifting in relation to this debate? As today's debate has served to illustrate, they have done so magnificently.

Kevin Barron: I shall not detain the House for too long; I rise just to support the Third Reading of the Bill. Opposition Members have said that it is something of an omnibus Bill, but I wish to comment on the small parts relating to tobacco. When the Bill has passed through all its stages, it will finish off some of this House's unfinished business on the advertising and promotion of tobacco in this country. The Bill containing the ad ban, as it was popularly called, went through the House a number of years ago. We can assume that most of it was implemented to good effect, because the level of smoking is decreasing in all categories, although among teenage girls and young women the situation is a bit difficult.
	The ad ban legislation introduced by this Government was supposed to eliminate anything
	(a) whose purpose is to promote a tobacco product, or
	(b) whose effect is to do so.
	I submit to the House that for years we have been banning the advertising and promotion of tobacco, but the tobacco companies have been using the point of sale to promote tobacco. That loophole, which has existed since that legislation was put through, has been closed by tonight's decisions. I say that because of the evidence I have in front of me, which includes a quote from Geoff Good, the global brand director of Imperial Tobacco, concerning the limited edition Lambert  Butler celebration packs, which increased sales by 60 million. He said that
	the pack design was the only part of the mix that was changed, and therefore we knew the cause and effect.
	Packs have been used to promote tobacco since the advertising ban came in.
	The Benson  Hedges Silver slidethe neat package that slides open as opposed to flipping open at the top, for examplewas described as follows:
	Slide is all about packaging.
	It
	appeals to young adult smokers and research shows they will buy into innovations such as unique packs.
	The Benson and Hedges Silver slide pack increased market share by 57.5 per cent.that is worth about 120 millionwithin 18 months of its introduction. A Gallaher spokesman stated that
	marketing restrictions make the pack the hero.
	It is clear that that has been the case for many years.
	If this legislation is brought in, packs will be brought from outside covers, they will be taken around and people will have them in their pocket, but they will not be seen when people go into a tobacco retailer. The test will be whether the holograms and everything else that attract young people in particular disappear from these packs in a few years' time.

Kevin Barron: For years, the tobacco industry has been saying that advertising is all about market share and that has not been true. In this case, it is, but it was not true when there was general advertising of tobacco products in this country. It was a case for the defence and it was a very weak one. Since we brought a general advertising ban into this country there has been decrease in smoking, which I think is directly related to the fact that the companies cannot promote tobacco. The fact that this means of promoting tobacco when one walks into a shop is no longer availablethe displays had got very sophisticated, with tobacco next to shelves of chocolate and so onwill further restrict the attraction of tobacco when people, young or old, go into tobacco outlets. This is a progressive move. I think we agreed to ban vending machines, too, in the last few minutes.
	The Government should be complimented on what they have done over the past 10 years in attacking this scourge of ill health in this country. Tobacco causes 50 per cent. of our health inequalities; 50 per cent. of people who smoke will die prematurely because of tobacco. We have probably gone as far as we can at this stage in stopping the promotion of tobacco. The Government's smoking cessation programmes and targets for smoking cessation over the past few years have been very good, too; they have helped to reduce tobacco's attack on the health of the nation and we are making progress. I thank the Government for eventually doing the things that people were arguing for in this House 20 or 30 years ago. They were done through gritted teeth as far as the tobacco companies were concerned, but they were done none the less.

David Taylor: If the hon. Gentleman had been here throughout the debate he would have heard that answered adequately. I am pleased that the amendment tabled by my right hon. Friend the Member for Makerfield (Mr. McCartney), which puts cigarette vending machines out of the reach of our children, has been accepted, and that we can uphold the World Health Organisation framework convention on tobacco control to protect health policy from the vested interests of the tobacco industry. I would have liked to have seen new clause 7 on plain packaging go furtherI would have liked the Lib Dems to have put it to the votebut that is for another day. I would like proxy sales to be banned, too, but I voted against the Tories' proposal, because what they suggested was not enforceable. However, I would like more action on that.
	Someone dies prematurely every four minutes from the effects of smoking15 people an hour, or 75 in the five hours of this debate, which would empty the Public Gallery steadily. This is a valuable step forward, and I congratulate the Government on taking it.

That this House takes note of European Union Document No. 17564/08, draft Directive laying down the framework for the accelerated deployment of intelligent transport systems in the field of road transport and for interfaces with other transport modes; and endorses the Government's cautious approach to discussions on this document. (Mr. Blizzard)
	 Question agreed to.

Motion made,
	That the Resolutions of the House of 30 January 1989 relating to House of Commons Services and 6 December 1991 relating to Access (Former members and United Kingdom Members of the European Parliament) shall cease to have effect insofar as they relate to United Kingdom members of the European Parliament. (Mr. Blizzard)
	Hon. Members: Object.

Motion made,
	That Dr Richard Taylor be a member of the West Midlands Regional Select Committee. (Mr. Blizzard)
	Hon. Members: Object.

Motion made,
	That Mary Creagh be discharged from the Yorkshire and the Humber Regional Select Committee and Mr Austin Mitchell be added. (Mr. Blizzard)
	Hon. Members: Object.

Motion made,
	That Linda Gilroy be discharged from the South West Regional Select Committee and Roger Berry be added.( Mr. Blizzard)
	Hon. Members: Object.

Motion made, and Question proposed, That this House do now adjourn. (Mark Tami.)

Richard Younger-Ross: I am grateful for the opportunity to bring again to the Floor of the House an issue that has been of concern to residents of the south-west for a long timeindeed, since 1989, when the then Conservative Government privatised the water companies and, in the view of myself, my parliamentary colleagues and most residents of the south-west, created a grave injustice, which has to this day led to the south-west paying more for its water and sewerage than any other part of the country.
	I note that Labour Members are present, and that several people from the Labour Benches and from among my Liberal Democrat parliamentary colleagues wish to intervene. I also note, however, that not one Member from the Conservative party is here to debate this important issue.
	The Government have been very slow in recognising the difficulties that I have mentioned. However, they have at last producedreluctantly, perhaps, and later than they should have donea report that allows us to try to make some progress. In asking Anna Walker to present a report on water charges, the Government have created a useful vehicle for debating not only the issue on which I want to concentrate but a lot of the other issues of water poverty and water shortage.
	In her foreword, Anna Walker points out the aim of the review and three of its particular points. The third is to
	make recommendations on any action that should be taken to ensure that England and Wales have a sustainable and fair
	I highlight the word fair
	system of charging in place. This could include changes to current legislation and guidance.
	She goes on:
	Prices can vary considerably between companies (average bills range from around 280 to 500). Customers are not used to such differences in prices for essential services,
	I underline the word essential
	and, if they are in a high cost area, consider it unfair.
	The report goes on to discuss regional costs and the fact that they should be allowed to continue. However, Anna Walker highlights the question of who should pay for environmental improvements from which all customers benefit. I wish to concentrate on the part of the report about environmental works. On page 55 of the report, in paragraph 3.3.18, Anna Walker writes:
	The arguments as to whether environmental improvements should be paid for by the local water customer, the national water customer or the taxpayer are complex. The review team would welcome views on the arguments it has set out in the interim report before reaching a firm conclusion in the final report...There are real choices to be made over the standards to be met, how future environmental improvements are achieved and the period over which they should be carried out, all of which can affect the costs radically and which are particularly important if the water customer locally or nationally is expected to pay for them.
	She goes on to discuss
	much greater formal involvement of customers in decisions on what is to be spent.
	To make the matter very clear, I should say that if there had been any consultation with the customers of the south-west, they would never have agreed to the system that we have, under which they end up paying far more for their water than people anywhere else in the country.

Linda Gilroy: The hon. Gentleman makes a powerful case, which his party and Labour Members have been making for far too long. Has he seen the report that has been submitted to the Walker review by the socio-economic research and intelligence observatorySERIOof Plymouth university, which emphasises the injustice and unfairness of the situation? Has he noted from that report that approximately a quarter of the English population visited the south-west in 2008?

Richard Younger-Ross: Indeed, and I think that the figure was 18.2 million, about 7.1 million of whom visited specifically to go to the seaside. I have a copy of that reportit is an excellent contribution and I hope that Anna Walker considers it. I congratulate the hon. Lady, who was partly responsible for bringing it about.

Richard Younger-Ross: That is a good point. The south-west has already paid for the bulk of its Clean Sweep programme, although it is still paying the interest costs. I hope that if the inquiry and the Government decided on spreading the costs fairly across the country, they would indeed be retrospective. I put that question to the Minister for the South West, and he did not rule it out. As the SERIO report states, the Environment, Food and Rural Affairs Committee said in 2009:
	The question for Defra is whether environmental improvements in certain regions, such as measures to protect bathing beaches in the south west, should be seen as a national benefit to be paid for by tax payers or as a regional infrastructure deficit
	the point put by my hon. Friend.
	People in the south-west are paying 497, which they expected to rise to 517 by 2015. Thames Water has the lowest figure, 286, and that was going to rise only to 343. A month after the Walker report came out, Ofwat leapt to the defence of water customersjust so that there is no doubt in the written record, I am being ironic. Its press release was headed: Ofwat holds bills down for customers. I will take it that a 6 per cent. cut in bills over the next four years is a cut, but Ofwat has not taken on the total injustice of the south-west paying more than other regions.

Richard Younger-Ross: I could not disagree with that point, so elegantly made by my hon. Friend.
	Ofwat has stepped in, but it has compounded the injustices. Table B of its document Comparison between companies' final business plan proposals and Ofwat Draft Determinations shows that the figure for the south-west, which was proposed to be 517 in 2015, will be only 458, which is a difference of minus 11 per cent. People in other regions, such as the Hartlepool Water region, will have a difference of 14 per cent., but they pay less than those in the south-west at the moment. Thames Water customers will pay 15 per cent. less than proposed, and they pay the lowest amount at the moment. Southern and Severn Trent are down 12 per cent. That does not deal with the fundamental injustice.
	I say to members of Ofwat that they might be good accountants, and they might know the cost of everything, but the one thing that they do not appear to know is the value of the resource that we have. They do not understand the social impact and corrosiveness of having a totally unjust system that allows the south-west to pay more and other areas to have their bills reduced even further. Ofwat objects to our principle because it says, The polluter pays. We all agree with that principle, but when it comes to sewerage, that is something that we all have to do. The elderly and the sick have to do it. Why should they have to pay more for doing it in the south-west than they do in the south-east? Why should the sick, who might have other problems, be charged excessively? The principle of polluter pays is fine up to a point, but this is an essential health service. Let us keep it that way, and let us have the charges fair and just. There are ways that that can be done without too much difficulty.

Huw Irranca-Davies: I begin not only by congratulating the hon. Member for Teignbridge (Richard Younger-Ross) on securing the first Adjournment debate after the summer recess but by facing up to my obligations, having contributed to the very problem that we are debating. I have holidayed in the south-west in two of the past three years with my family, and I am afraid that we have contributed either to the problem or to the tourism economyI think both.
	I genuinely congratulate the hon. Gentleman on both securing the debate and summarising the salient points pertaining to a crucial issue for his constituents and those of some of my hon. Friends, who have campaigned on this issue for years and years. It would ill become me to dwell on the iniquities of previous Governments who took through privatisation and made errors. We are trying to consider how we can resolve the situation.
	The House will be aware that this is not the first debate that we have had on water charges this year. It is, in fact, the third. That is a tribute to the pressure that hon. Members are keeping up on the Government and the regulator to seek a resolution. In May, the hon. Member for East Devon (Mr. Swire) secured a debate on water charging in the south-west. In June, my hon. Friend the Member for Plymouth, Sutton (Linda Gilroy) secured a debate on water charging and metering. Of course, the hon. Member for Teignbridge was part of the delegation that I met on 16 July to discuss the interim report of the Walker review of charging for household water and sewerage services. The Members who are present this evening have been pursuing the matter with some zeal on behalf of their constituents and the south-west region, and they have met me on several occasions. I thank them for giving me the opportunity to hear their views.
	This is the first debate on the matter in the House since Anna Walker published her interim report, so I very much welcome it. She did so on 29 June, and I should like to take this opportunity to put on record once again my appreciation of the excellent work that Anna and her team have done so far. They have toured the countrynorth and south, east and westand returned to areas including the south-west to take views. I recognise the difficult challenges that were given to Anna Walker. The Government response to the interim report welcomed its publication and acknowledged that it had raised important questions about the fairness of current charges. It also pledged a full Government response when the final report is published.
	I hope that hon. Members understand that I do not want to pre-empt or pre-define Anna Walker's findings. I believe that it is right to wait for the final report before responding to individual recommendations or the report as a whole. Many of the interim proposals, such as how water is paid for and the affordability of bills, are linked. It makes sense to consider the final recommendations as a package rather than in isolation. Indeed, the debate of my hon. Friend the Member for Plymouth, Sutton focused on how many factors are interwoven.
	In addition, the interim report invited further views on several key questions. As part of that, a second workshop was held in Plymouth on 17 July, which was chaired by my hon. Friend the Member for Plymouth, Sutton. The review team is currently working up its final proposals in the light of the comments that were received there and in other roadshows.
	For those reasons, I do not propose to pre-empt the Walker review's final recommendations, although I want to try to respond in general terms to the points that the hon. Member for Teignbridge and others have made in the debate so far.

Huw Irranca-Davies: Yes, I am more than happy to give that commitment. One of the benefits of the way in which my hon. Friend and Opposition colleagues have pursued the matter is that they have tried to find solutions rather than simply to produce heat rather than light. On that basis, I am happy to meet a delegation again, led by my hon. Friend with others, so that we can examine Anna Walker's final deliberations. I am looking forward to meeting them.
	The hon. Member for Teignbridge referred to the cost of cleaning up beaches and the fact that 30 per cent. of the country's beaches are in the south-west. I am familiar with that because, if Wales is split from the equationWales claims to have the highest proportion of coast per head of population in the UKI acknowledge the hon. Gentleman's point. When looking at the matter in terms of England, the population compared with the amount of coastline in the south-west is starkly significant. As I have made clear in previous debates, households in the south-west pay more for their water and sewerage services than those elsewhere in the country. That is an inalienable fact.
	That reflects to some extent the substantial investment that South West Water has made since privatisation, including, as the hon. Gentleman said, the Clean Sweep programme. The cost to customers of that company and in that region has fallen. The Walker review has been looking carefully at how environmental improvements, which confer some national benefits, should be paid for.
	Paragraph 3.3.18 of the interim report concluded, as the hon. Gentleman said, that
	the arguments as to whether environmental improvements should be paid for by the local water customer, the national water customer or the taxpayer are complex.
	I think that we would all agree with that. Where the burden falls is not simple, but very complex. The report goes on to say in paragraph 3.6.2 that
	the review team is minded to recommend that, in the long term, the net benefits are likely to be limited of moving to national or taxpayer charging for some environmental benefits.
	As I said a moment ago, I do not want to pre-empt Anna Walker's final recommendation on the so-called equalisation of environmental investment, but she has identified several practical issues around equalisation in the interim report. In particular, if Anna recommends an equalisation scheme, she will need to decide what counts as an environmental improvement with a public benefit.
	All environmental legislation has some public benefit. In terms of water quality, it would not just be the bathing waters directive, but a host of other environmental measures. The matter is therefore complex. For example, the cost of building the Thames tideway might need to be included. Thames Water customers face a 2 billion bill to construct that to help meet the requirements of the urban waste water treatment directive and prevent sewage discharges into the Thames. That is only one example, but it is a key one, which is in front of us now.
	The final report also needs to decide whether it would be fair to equalise costs that have direct or indirect private benefits, such as local tourism, and public health benefits from clean beaches. Environmental costs also reflect the local costs incurred, for example, in treating sewage and other pollutants. If they cost more to treat in some parts of the country than in others, Anna will need to advise on whether it is fair to expect companies to subsidise those who live in high-cost areas. That is the nub of the issue. In addition, Anna will need to consider whether sharing environmental costs beyond the customer base of individual companies would risk acting as a disincentive to keep cost pressures, and hence customers' bills, down. Those are the things that Anna must wrestle with as she comes to her final deliberations.

Huw Irranca-Davies: Indeedas the hon. Gentleman says, Ofwat has not addressed the inequalities, which is what Anna is wrestling with as we speak. She is trying to finalise her comments on sharing the environmental costs, meaning equalising the costs across a wider customer base beyond the region, which has not been done before. Ofwat has acted to keep bills down on this occasion, in its interim findings on the periodic review 2009 processwe await the final determinationbut it has not looked at equalisation. Anna is looking at whether she can address those issues. There would also be administrative costs in setting up and operating an equalisation mechanism, which ultimately would have to be paid by water customers. Anna Walker is aware of those difficult issues and is looking closely at whether any equalisation scheme can be both fair and workable.
	The interim Walker report invited views on a number of proposals on the related issue of water affordability, including capping the bills of metered households on council tax benefit in high-cost areas, and refinement to the WaterSure scheme, including capping bills at the national rather than regional average. There are pros and cons associated with all such proposals, and it is essential to ensure that Anna Walker's final recommendations are perceived as fair by everyonenot only those in the south-west, but across the board in England and Wales. Any measures to assist customers in the south-west must be paid for either by other customers of South West Water, by water customers nationally or by taxpayersthere are no other options, unless someone is going to surprise me tonight.
	I must be honest: as well as being contacted and lobbied by the extremely strong campaign from the south-westI have regularly met hon. Members involved in thatstrong concerns have been expressed by other hon. Members, particularly from the north-east of England. They have said that their constituents who do not find it easy to pay bills now would be faced with additional burdens in future if they had to subsidise costs elsewhere. The reality is that the problem is difficult to square, but that underlines the challenges that Anna Walker faces as she finalises her report. There are no easy solutions or quick fixes, and almost every different proposal for water charging creates winners and losers.
	The hon. Gentleman made some observations on Ofwat's proposals and on what its draft determinations would mean for water and sewage bills. He said that bills could fall by around 30 between 2010 and 2015 for south-west households and compared that with other bills that are already low. I understand him, but as I think he would agree, we are seeing a dampening in the draft proposals for households in the south-west. By the way, the determination on that is due in late November.
	In conclusion, I recogniseas I have said repeatedly in this House and elsewherethat the cost of water and its affordability is an issue in the south-west. I very much look forward to seeing Anna Walker's final recommendations, including those on paying for environmental improvements, hopefully in November.
	I know that my right hon. Friend the Prime Minister has pledged to meet a delegation led by my hon. Friend the Member for Plymouth, Sutton to discuss the Walker review. I am sure that other hon. Members who have attended this debate will also be there. I would, of course, be happy to have an additional meeting with the hon. Member for Teignbridge, my hon. Friend and other hon. Members with constituencies in the south-west to discuss the review's final report once it has been published.
	I understand the criticisms that have been levelled about tardiness on this issue, but the Government's commitment to looking at it properly has now been evidenced by the bringing forward of Anna Walker's report. I commend the work that she has done on what is not an easy task. I also commend the work that hon. Members here have done in campaigning on this issue and in bringing more light than heat to it. I look forward to the final recommendations and meeting with hon. Members who wish to advance the case of their constituents in this matter.
	 Question put and agreed to.
	 House adjourned.